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Unida Systems has 40 million shares outstanding trading for $ 8 per share. Inaddition, Unida has $ 95 million in outstanding debt. SupposeUnida's equity cost
Unida Systems has 40 million shares outstanding trading for $ 8 per share. Inaddition, Unida has $ 95 million in outstanding debt. SupposeUnida's equity cost of capital is 13 %, its debt cost of capital is 9 %, and the corporate tax rate is 34 %.
a. What isUnida's unlevered cost ofcapital?
b. What isUnida's after-tax debt cost ofcapital?
c. What isUnida's weighted average cost ofcapital?
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