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II-4. Here is YYs market-value balance sheet (figures in $ millions): The debt is yielding 6%, and the cost of equity is 10%. The tax
II-4. Here is YYs market-value balance sheet (figures in $ millions): The debt is yielding 6%, and the cost of equity is 10%. The tax rate is 25%. Investors expect this level of debt to be permanent. (6pts) (1) What is YYs WACC? (Please count to XX.XX%.) (2) How would the market-value balance sheet change if YY retired all its debt?.
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