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Given the following for ABC Company, at what weighted average cost of capital (WACC) will ABC Company generate zero residual operating income (ROPI) in 2007?

Given the following for ABC Company, at what weighted average cost of capital (WACC) will ABC Company generate zero residual operating income (ROPI) in 2007?

($ in thousands) 2007, 2006 Net operating assets (NOA), end of year: $9,000 $6,100 Net operating assets (NOA), beginning of year $6,100 $5,650 Net operating profit after tax (NOPAT) $1,375 $1,200 Weighted average cost of capital 8% 8%

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