Mirion Tech, Inc

question 6

Multiple Choice

Mirion Tech, Inc., has r_E of 12%, an r_D of 6%, at a debt-equity ratio of 0.50. Mirion plans to raise enough preferred stock to retire half of their outstanding common stock, which currently has a market value of $7 million. If the preferred stock has an expected rate of return of 10%, what is the new WACC? (Assume a 21% marginal corporate tax rate and that r_D remains at 6%.)

• A)14.23%
• B)11.02%
• C)9.58%
• D)6.60%

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Definitions:

B. F. Skinner

An American psychologist and behaviorist best known for his work in behaviorism and the development of the theory of operant conditioning.

Internally Oriented

Refers to a focus or perspective that emphasizes inward-looking practices or philosophies, prioritizing internal states, feelings, or operations.

Physically Healthier

Refers to a state of improved physical well-being, often achieved through exercise, proper nutrition, and avoiding harmful habits.

Collectivist Cultures

Societies that prioritize the group over the individual, emphasizing community, cooperation, and shared values.