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Palencia Paints Corporation has a target capital structure of 30% debt and 70% common equity, with no preferred stock. Its before tax cost of debt
Palencia Paints Corporation has a target capital structure of 30% debt and 70% common equity, with no preferred stock. Its before tax cost of debt is 10and its marginal tax rate is 10%. The current stock price is Po - $26.00. The last dividend wis Do - $2.25, and it is expected to grow at constant rate. What is its cost of common equity and its WACC? Do not round Intermediate calculations. Round your answers to two decimal places b. WACC
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