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XYZ Inc. ' s target capital structure is 6 5 % equity and 3 5 % debt. Its cost of equity is 1 2 %

XYZ Inc.

'

s target capital structure is

65 %

equity and

35 %

debt. Its cost of equity is

12 %,

and the before

-

tax cost of debt is

5 % .

The relevant tax rate is

21 % .

Calculate the WACC for the firm.

(

Enter percentages as decimals and round to

4

decimals

)

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