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Question 5 1 pts If the income tax rate applicable to a firm is 35% and the pre-tax cost of preferred stock is 10%, what
Question 5 1 pts If the income tax rate applicable to a firm is 35% and the pre-tax cost of preferred stock is 10%, what is the after-tax cost of preferred stock? O 10% O None of the choices is correct O 6.5% O 3.5% Question 6 1 pts Based on the information in the table below, what is the firm's WACC? Target % in Capital Structure Component Cost (pre-tax) Component Cost (after-tax) Weighted Component Cos Debt 20.00% 2.99% Preferred Stock 10.00% 4.44% 4.44% Equity 70.00% 13.50% 13.50% Tax Rate = 40.00% WACC = o None of the choices is correct O 10.25% O 10.49% O 10.13% O 13.50%
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