What Is the WACC for a Firm Financed with 30

question 50

Multiple Choice

What is the WACC for a firm financed with 30% debt if the debt investors require a return of 12.5% and equity investors require a 16% return? The corporate tax rate is 20%.

• A) 11.8%
• B) 13.3%
• C) 14.2%
• D) 14.8%

---

Definitions:

World Poverty

A global issue characterized by the lack of basic resources, services, and opportunities necessary for people to live a healthy and productive life, disproportionately affecting developing countries.

Causes

Factors or conditions that bring about an effect or influence the occurrence of an event, action, or condition.

Wealthy Nations

Countries characterized by a high level of economic development, significant gross domestic product (GDP), and advanced technological infrastructure, leading to a higher standard of living for their populations.

Sources Of Wealth

The origins and means through which individuals or societies acquire economic resources and increase their financial assets, including labor, investment, entrepreneurship, and natural resources.