Question
Your firm issues debt with a YTM of 8%. Your estimated cost of equity is 12%. Your marginal tax rate is 25%. The Treasury department
Your firm issues debt with a YTM of 8%. Your estimated cost of equity is 12%. Your marginal tax rate is 25%. The Treasury department says you plan to finance with 50% debt and 50% equity in the future. What is your firms WACC?
ra= (wi*ri) + (wp*rp) + (ws*rr or n)
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Financial management theory and practice
Authors: Eugene F. Brigham and Michael C. Ehrhardt
12th Edition
978-0030243998, 30243998, 324422695, 978-0324422696
