What Is the WACC for a Firm with 40% Debt,20

question 80

Multiple Choice

What is the WACC for a firm with 40% debt,20% preferred stock,and 40% equity if their respective costs are 9.23% before tax,12%,and 18%? The firm's tax rate is 35%.

• A) 9.48%
• B) 11.16%
• C) 12.00%
• D) 15.60%

---

Definitions:

Group Payout

Refers to a system of compensation based on the performance of a group or team, rather than individual performance alone.

Family-Friendly Benefits

Work benefits designed to support employees' needs regarding their family responsibilities, such as flexible working hours and parental leave.

Part-Time Employment Options

Part-time employment options refer to employment setups that require workers to work fewer hours than full-time positions, often offering flexible working hours.

Counselling

A professional service offering guidance and assistance to individuals in resolving personal, social, or psychological challenges.