A firm has 4,000,000 shares of stock outstanding with a price per share equal to $22.There are 200,000 bonds outstanding each priced at $995 each.The cost of equity is 14 percent,the cost of debt is 8 percent,and the corporate tax rate is 34 percent.What is the WACC?
A) 10.3 percent.
B) 9.8 percent.
C) 8.0 percent.
D) 8.8 percent.
Correct Answer:
Verified
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