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

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Suppose your firm has decided to use a divisional WACC approach to analyze projects. The firm currently has four divisions, A through D. with average betas for each division of 0.6,1.0,1.3, and 1.6 , respectively. Assume all current and future projects will be financed with 60 percent debt and 40 percent equity, the current cost of equity (based on an average firm beta of 1.0 and a current risk-free rate of 6 percent) is 11 percent and the after-tax yield on the company's bonds is 8 percent. What will the WACCs be for each division? (Round your answers to 2 decimal places.) Suppose that B2B, Inc, has a capital structure of 35 percent equity, 16 percent preferred stock, and 49 percent debt. Assume the before-tax component costs of equity, preferred stock, and debt are 13.5 percent, 9.0 percent, and 8.5 percent, respectively. What is B2B's WACC if the firm faces an averoge tax rate of 21 percent and can make full use of the interest tax shield? (Round your answer to 2 decimal places.)

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