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Suppose your firm has decided to use a divisionai WACC approach to analyze projects. The firm currently has four divisions, A through D , with

Suppose your firm has decided to use a divisionai WACC approach to analyze projects. The firm currently has four divisions, A through D, with average betas for each division of 0.5,1.0,1.3 and 1.6, respectively. If all current and future projects will be financed with half debt andinaff equity, and if the current cost of equity (based on an average firm beta of 1.0 and a current riskfree rate of 7 percent) is 14 percent and the after-tax yield on the company's bonds is 8 percent, what are the WACCs for divisions A throuigh D?
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