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The AAA Company has a debt to total value ratio of 0.5. The cost of debt is 8 percent and that of unlevered equity is
The AAA Company has a debt to total value ratio of 0.5. The cost of debt is 8 percent and that of unlevered equity is 12 percent. Which statements are correct? Select all that apply.
A | The weighted average cost of capital is 12 percent if the tax rate is 30 percent | |
B | The weighted average cost of capital is 14.8 percent if the tax rate is 30 percent. | |
C | The return on assets is 16 percent | |
D | The return on assets is 12 percent | |
E | The weighted average cost of capital is 12 percent if the tax rate is 30 percent |
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