With a Tax Rate of 35%,calculate the WACC for a Firm

question 4

Multiple Choice

With a tax rate of 35%,calculate the WACC for a firm that pays 10% on its debt,requires an 18% rate of return on its equity,and finances 45% of assets with debt.

• A) 12.83%
• B) 14.00%
• C) 14.40%
• D) 18.20%

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Definitions:

Pleural

Pertaining to the pleura, the membrane surrounding the lungs and lining the chest cavity.

Abdominal

Relating to the abdomen, the body region between the thorax (chest) and pelvis.

Ventral

Referring to the front or forward part of the body, in contrast to the back or dorsal side.

Homeostasis

The self-regulating process by which biological systems maintain stability while adjusting to conditions that are optimal for survival.