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You were hired as a consultant to Bell Inc., whose target capital structure is 30% debt, 15% preferred, and 55% common equity. The new long-term
You were hired as a consultant to Bell Inc., whose target capital structure is 30% debt, 15% preferred, and 55% common equity. The new long-term debt before tax cost is 8.00%, the cost of preferred is 7.50%, and the cost of retained earnings is 11.50%. The firm will not be issuing any new stock. The tax rate of the firm is 25%. What is its WACC?
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