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Sparky, Inc., has found that its cost of equity is 20 percent, and its after-tax cost of debt is 6 percent. If the firm is
Sparky, Inc., has found that its cost of equity is 20 percent, and its after-tax cost of debt is 6 percent. If the firm is financed with 71 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? Answer to the nearest 0.01%
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