The market value of DRK Inc.'s debt is $200 million and the total market value of the firm is $600 million. The cost of equity is 15%, the cost of debt is 8%, and the tax rate is 34%. What is this firm's
WACC?
A) 11.14%
B) 11.76%
C) 12.25%
D) 12.67%
E) 14.07%
Correct Answer:
Verified
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