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Firm has a target capital structure of 30% common stock, 10% preferred stock and 60% debt. Its pre-tax cost of equity is 10%, the pre-tax
Firm has a target capital structure of 30% common stock, 10% preferred stock and 60% debt. Its pre-tax cost of equity is 10%, the pre-tax cost of preferred stock is 8%, and the pre-tax cost of debt is 5%. The relevant tax rate is 20%. What is firms WACC?
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