Find the Weighted Average Cost of Capital for a Firm

question 81

Multiple Choice

Find the weighted average cost of capital for a firm that has a debt-to-equity ratio of 1½,a tax rate of 34 percent,a levered cost of equity of 12 percent and a pre-tax cost of debt of 10 percent.

• A)9.6 percent
• B)7.968 percent
• C)8.76 percent
• D)none of the options

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