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Rumolt Motors has 28 million shares outstanding with a share price of $59 per share. In addition, Rumolt has issued bonds with a total current
Rumolt Motors has 28 million shares outstanding with a share price of $59 per share. In addition, Rumolt has issued bonds with a total current market value of $456 million. Suppose Rumolt's equity cost of capital is 11%, and its debt cost of capital is 7%. a. What is Rumolt's pre-tax WACC? b. If Rumolt's corporate tax rate is 22%, what is its after-tax WACC?
Tried solving it on my own but I think I'm either missing a step or doing something completely wrong. thanks in advance
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