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Please answer all parts of the question, Thank you! Rumolt Motors has 43 million shares outstanding with a share price of $13 per share. In
Please answer all parts of the question, Thank you!
Rumolt Motors has 43 million shares outstanding with a share price of $13 per share. In addition, Rumolt has issued bonds with a total current market value of $575 million. Suppose Rumolt's equity cost of capital is 15%, and its debt cost of capital is 6%. a. What is Rumolt's pre-tax WACC? b. If Rumolt's corporate tax rate is 30%, what is its after-tax WACC? a. What is Rumolt's pre-tax WACC? Rumolt's pre-tax WACC is %. (Round to two decimal places.)Step by Step Solution
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