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Rumolt Motors has 30 million shares outstanding with a price of $15 per share. In addition, Rumolt has issued bonds with a total current market

  1. Rumolt Motors has 30 million shares outstanding with a price of $15 per share. In addition, Rumolt has issued bonds with a total current market value of $150 million. Suppose Rumolts equity cost of capital is 10%, and its debt cost of capital is 5%.
  1. What is Rumolts pretax WACC?
  2. If the corporate tax rate is 35%, what is its after-tax WACC

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