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Sparky, Inc., has found that its cost of equity is 16 percent, and its after-tax cost of debt is 2 percent. If the firm is

image text in transcribed Sparky, Inc., has found that its cost of equity is 16 percent, and its after-tax cost of debt is 2 percent. If the firm is financed with 72 percent equity and the remainder of the financing is in debt, what is the WACC (weighted average cost of capital) for Sparky if it is subject to a 25% tax rate

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