A Firm Requires an Investment of $20,000 and Borrows $10,000

question 64

Multiple Choice

A firm requires an investment of $20,000 and borrows $10,000 at 8%. If the return on equity is 20%, what is the firm's pretax WACC?

• A) 15%
• B) 17%
• C) 14%
• D) 16%

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Definitions:

Add

To combine one or more numbers or quantities to get a sum or total.

Inference Forms

Logical structures that guide the transition from premises to conclusions in reasoning.

MP

Member of Parliament, an individual elected to represent a geographic area in the parliament.

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Quantitative study of relative hereditary and environmental influences on behavior.