Question
Given the following information on Big Brothers, Inc. capital structure, compute the companys weighted average cost of capital (WACC). The companys marginal tax rate is
Given the following information on Big Brothers, Inc. capital structure, compute the companys weighted average cost of capital (WACC). The companys marginal tax rate is 40%.
Round the answer to two decimal places in percentage form.
| Type of Capital | Percent of Capital Structure | Before-Tax Component Cost |
|---|---|---|
| Bonds | 31% | 13.33% |
| Preferred Stock | 18% | 16.71% |
| Common Stock | Please calculate it | 12.73% |
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Quantitative Trading
Authors: Ernest P. Chan
2nd Edition
1119800064, 978-1119800064
