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Suppose your firm has decided to use a divisional WACC approach to analyze projects. The firm currently has 2 divisions. A and B, with betas

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Suppose your firm has decided to use a divisional WACC approach to analyze projects. The firm currently has 2 divisions. A and B, with betas for each division of 125 and 25, respectively. If all current and future projects will be financed with haif debt and half equity, and if the current cost of equity (based on an overage firm bete of 10 and a curreot risk.free rate of 4 percent) is 12 . percent and the after-tax yield on the company's bonds is 8 percent, what are the WACCs for divisions A and B ? Multiple Choice 11.00 percent 16.00 percent 15.00 percent, 30.00 percent 25.00 percent 30.00 percent

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