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Palo Verde, Inc., has found that its cost of equity is 11 percent, and its (before-tax) cost of debt is 4 percent. If the firm

image text in transcribed Palo Verde, Inc., has found that its cost of equity is 11 percent, and its (before-tax) cost of debt is 4 percent. If the firm is financed with 70 percent equity and the remainder of the financing is in debt, what is the WACC (weighted average cost of capital) for Palo Verde if it is subject to a 25% tax rate? Answer to the nearest 0.01%

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