Question
Flowercenter is 40% financed by debt with a yield-to-maturity of 8.5%. The beta of its equity is 1.3. The market risk premium is 8.4%. The
Flowercenter is 40% financed by debt with a yield-to-maturity of 8.5%. The beta of its equity is 1.3. The market risk premium is 8.4%. The risk-free rate is 3.8%. Given a tax rate of 21%, what is the WACC for Flowercenter?
10.74%
11.91%
11.52%
12.38%
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Foundations of Financial Management
Authors: Stanley Block, Geoffrey Hirt, Bartley Danielsen
16th edition
125927716X, 978-1259687969, 1259687961, 978-1259277160
