The Felix Filter Corp

question 39

Multiple Choice

The Felix Filter Corp. maintains a debt-equity ratio of .6. The cost of equity for Richardson Corp. is 16%,the cost of debt is 11% and the marginal tax rate is 30%. What is the weighted average cost of capital?

• A) 8.38%
• B) 11.02%
• C) 12.89%
• D) 13.00%
• E) 14.12%

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Definitions:

Gallflies

A group of insects known for their ability to induce gall formation on plants, where they then live and feed.

Intermediate Gall Sizes

Refers to the medium range of sizes for galls, which are abnormal growths on plants caused by various organisms.

Stabilizing Selection

An evolutionary process that favors the intermediate variants of a trait, leading to a decrease in variation around a certain phenotype, often maintaining the status quo in a population.

Natural Selection

The process by which organisms better adapted to their environment tend to survive and produce more offspring, driving evolution.