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The Rare Find Co . has the following information: Debt outstanding: $ 1 , 5 0 0 million The before - tax cost of debt:
The Rare Find Co has the following information:
Debt outstanding: $ million
The beforetax cost of debt:
Market cap: $ million
Cost of common stock:
Tax rate:
Rare Find is evaluating a project with the following information:
Over the next five years, EBIT will equal million each year
An investment of $ million is required in net working capital at the beginning of the project, which will be recovered at the end.
The equipment cost will be $ million, depreciated using the straightline method to zero over the project's life, with no salvage value.
The project requires an additional risk premium above the firm's WACC.
a Calculate the weight of debt for the firm. Calculate the aftertax cost of debt for the firm. Enter percentages as decimals and round to decimalsEnter percentages as decimals and round to decimals
b Calculate the aftertax cost of debt for the firm. Enter percentages as decimals and Calculate the WACC for the firm. Enter percentages as decimals and round to decimalsround to decimals
c Calculate the WACC for the firm. Enter percentages as decimals and round to decimals
d Calculate the riskadjusted WACC for the firm. Enter percentages as decimals and round to decimals
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