Question
U Corporation uses no preferred stock. Their capital structure uses 70% debt (hint: the rest is equity). Their marginal tax rate is 33.06%. Their before-tax
U Corporation uses no preferred stock. Their capital structure uses 70% debt (hint: the rest is equity). Their marginal tax rate is 33.06%. Their before-tax cost of debt is 6.88%. U Corporation's stock has a beta of 2.84. The current risk-free rate is 3.59%, and the overall market is expected to return 10% over the long-run. What is U Corporation's weighted average cost of capital (WACC)?
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Quantitative Financial Analytics The Path To Investment Profits
Authors: Edward E Williams, John A Dobelman
1st Edition
9813224258, 978-9813224254
