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Required: (a) Calculate the after-tax weighted average cost of capital of Tufa Co on a market value basis. (22 marks) (b) Discuss the circumstances under
Required: (a) Calculate the after-tax weighted average cost of capital of Tufa Co on a market value basis. (22 marks) (b) Discuss the circumstances under which it is appropriate to use the current WACC of Tufa Co in appraising an investment project. (10 marks) (c) Discuss THREE advantages to Tufa Co of using convertible loan notes as a source of long-term finance. (8 marks) Total 40 marks Required: (a) Calculate the after-tax weighted average cost of capital of Tufa Co on a market value basis. (22 marks) (b) Discuss the circumstances under which it is appropriate to use the current WACC of Tufa Co in appraising an investment project. (10 marks) (c) Discuss THREE advantages to Tufa Co of using convertible loan notes as a source of long-term finance. (8 marks) Total 40 marks
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