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Pfd Company has debt with a yield to maturity of 6.5% , a cost of equity of13.7% , and a cost of preferred stock of
Pfd Company has debt with a yield to maturity of 6.5% , a cost of equity of13.7% , and a cost of preferred stock of 9.6% . The market values of its debt, preferred stock, and equity are 13.1 million,2.9 million, and 15.1million, respectively, and its tax rate is 40% . What is this firm's after-tax WACC? Note: Assume that the firm will always be able to utilize its full interest tax shield.
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