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Sushi Truck has the following capital structure to run its sushi business. It uses equity, preferred stock, and debt in the following proportions: 70% equity,
Sushi Truck has the following capital structure to run its sushi business. It uses equity, preferred stock, and debt in the following proportions: 70% equity, and equal amounts in preferred stock and debt. The annual costs of equity, preferred stock, and debt equal 18%, 8%, and 5%, respectively. Sushi Truck falls into 32% corporate income tax bracket. Calculate Sushi Truck's average annual cost of running its sushi business, also known as the Weighted Average Cost of Capital
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