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The Abco Co. maintains a debt-equity ratio of 70 and has a tax rate of 39 percent. The firm does not issue preferred stock. The
The Abco Co. maintains a debt-equity ratio of 70 and has a tax rate of 39 percent. The firm does not issue preferred stock. The cost of equity is 12 percent and the after-tax cost of debt is 5 percent. What is Abco's weighted average cost of capital? A 8.8 percent B.8.9 percent C 9.1 percent D.9.3 percent E 9.5 percent
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