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those answers are wrong. could you let me know the answers? Problem 19-5 WACC Whispering Pines Inc. is all-equity-financed. The expected rate of return on
those answers are wrong. could you let me know the answers?
Problem 19-5 WACC Whispering Pines Inc. is all-equity-financed. The expected rate of return on the company's shares is 11.25%. a. What is the opportunity cost of capital for an average-risk Whispering Pines investment? (Enter your answer as a percent rounded to 2 decimal places.) Opportunity cost of capital 12.25 % b. Suppose the company issues debt, repurchases shares, and moves to a 27% debt-to-value ratio (DIV = 0.27). What will be the company's weighted-average cost of capital at the new capital structure? The borrowing rate is 6.75% and the tax rate is 21%. (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.) Weighted average cost of capital 9.99%Step by Step Solution
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