Question
Reactive Power Generation has the following capital structure. Its corporate tax rate is 21%. Security Market Value Required Rate of Return Debt $ 20 million
Reactive Power Generation has the following capital structure. Its corporate tax rate is 21%.
| Security | Market Value | Required Rate of Return | ||||
| Debt | $ | 20 | million | 6 | % | |
| Preferred stock | 10 | million | 8 | |||
| Common stock | 50 | million | 12 | |||
What is its WACC? (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.)
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Essentials of Investments
Authors: Zvi Bodie, Alex Kane, Alan J. Marcus
10th edition
77835425, 978-0077835422
