Question
The pretax cost of debt is 5% for Phillips Equipment. The cost of equity is 10%. The market value of debt is $100,000 and the
The pretax cost of debt is 5% for Phillips Equipment. The cost of equity is 10%. The market value of debt is $100,000 and the market value of equity is $200,000. Tax rate is 40%. What is the WACC (weighted average cost of equity) for Phillips Equipment. (round your answer to two decimal places).
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International Financial Management
Authors: Jeff Madura
2nd Edition
0314430296, 978-0314430298
