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How do I calculate these to end up with the correct answer highlighted in Green? A firm is comprised of 30% equity and 70% debt.
How do I calculate these to end up with the correct answer highlighted in Green?
A firm is comprised of 30% equity and 70% debt. If the cost of equity is 10% the cost of debt is 5%, and the tax rate is 40%, what is the after tax cost of debt for the company? 1 3% 3.5% 5% 2.1%
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