Use the Following Information to Answer the Question(s)below

question 74

Multiple Choice

Use the following information to answer the question(s) below.
Wyatt Oil is considering an investment in a new project with an unlevered cost of capital of 11%.Wyatt's corporate tax rate is 21% and its debt cost of capital is 6%.The project has free cash flows of $25 million per year which are expected to decline by 3% per year.
-If Wyatt adjusts its debt once per year to maintain a constant debt-equity ratio of 50%,then the appropriate WACC for this new project is closest to:

• A)7.5%.
• B)8.67%.
• C)10.27%.
• D)10.8%.

---

Definitions:

Making Friends

The process of forming connections and relationships with others that provide companionship, support, and a sense of belonging.

Losing a Friend

The experience of ending a friendship due to various reasons, which can lead to feelings of sadness, loneliness, and a period of adjustment and grief.

Without Friends

The state or condition of being without any social connections or companions.

Severe Maladjustment

A significant inability to adapt to and interact socially within one's environment, potentially leading to psychological issues.