Question
Rogot Instruments makes fine violins and cellos. It has $ 1.3 million in debtoutstanding, equity valued at $ 2.7 million, and pays corporate income tax
Rogot Instruments makes fine violins and cellos. It has $ 1.3 million in debtoutstanding, equity valued at $ 2.7 million, and pays corporate income tax at rate 30 %. Its cost of equity is 11 % and its cost of debt is 8 %. (Round to two decimal places)
a. What isRogot's pre-taxWACC?
b. What isRogot's (effectiveafter-tax) WACC?
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Fundamentals Of Financial Management Concise
Authors: Eugene F. Brigham, Joel F. Houston
11th Edition
0357517717, 9780357517710
