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Problem 2 Palo Alto Hospital has a target capital structure of 3 0 % debt and 7 0 % equity. Its cost of equity estimate

Problem 2
Palo Alto Hospital has a target capital structure of 30% debt and 70% equity. Its cost of equity estimate is 14.4% and its cost of tax-exempt debt estimate is 8.6%. What is the hospital's corporate cost of capital? Please show your work.
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