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You have collected the following information about a company: Source of capital Market value Before-tax cost Long-term debt $130,000 8% Preferred stock $50,000 11%
You have collected the following information about a company: Source of capital Market value Before-tax cost Long-term debt $130,000 8% Preferred stock $50,000 11% Common stock $400,000 18% Total $580,000 The company's total (federal plus state) marginal tax rate is 39%. Part 1 What is the weighted average cost of capital? Attempt 1/4 for 10 pts.
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Public Finance and Public Policy
Authors: Jonathan Gruber
4th edition
1429278455, 978-1429278454
