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Problem 8 Afim has equity of 450000 It has 5 bonds otstanding as follows Bond 1 1130000 16% Bond 2 160000 Bond 385,000 745.000 Assume
Problem 8 Afim has equity of 450000 It has 5 bonds otstanding as follows Bond 1 1130000 16% Bond 2 160000 Bond 385,000 745.000 Assume the following Bond 4 320 Bond 5 Tax rate: 35% Real, risk-free rate of retum: 1.3% Expected inflation: 2.1% Market Risk Premium 78% Company Beta what is this firm's Weighted Average Cost of Capital? Show all calculations, and be sure to show separately your calculation of the Cost of Debt and Cost of Equity
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