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

question 90

Multiple Choice

Use the following information to answer the question(s) below.
Galt Industries has no debt,total equity capitalization of $600 million,and an equity beta of 1.2.Included in Galt's assets is $90 million in cash and risk-free securities.Assume the risk-free rate is 4% and the market risk premium is 6%.
-Galt's WACC is closest to:

• A)10.6%.
• B)11.2%.
• C)11.8%.
• D)12.5%.

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Definitions:

Personally Approve

A process or action whereby an individual gives their direct and explicit approval or consent.

Cognitive Dissonance Theory

A theory suggesting that people experience discomfort when holding conflicting cognitions, leading them to change their attitudes, beliefs, or actions.

Role-Playing Theory

A theory in social psychology that suggests individuals take on specific roles in group settings, influenced by the expectations of the social environment.

Attribution Theory

A psychological theory that examines how individuals interpret and understand their own behavior and the behavior of others by attributing causes to actions.