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Managerial Finance 650 Problem 9-08 (WACC) David Ortiz Motors has a target capital structure of 40% debt and 60% equity. The yield to maturity on

Managerial Finance 650

Problem 9-08 (WACC)

David Ortiz Motors has a target capital structure of 40% debt and 60% equity. The yield to maturity on the company's outstanding bonds is 10%, and the company's tax rate is 25%. Ortiz's CFO has calculated the company's WACC as 10.2%. What is the company's cost of equity capital?

Round your answer to the nearest whole number.

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