FIN MCQ FIN3403 Suppose a firm's capital structure consists of 30% debt, 10% preferred stock and 60% equity. the form's bond yield 10% on average before taxes, the cost preferred stock is 8% and the cost of equity is 16%. Calculate the form's WACC assuming a tax rate of 40%.

Suppose a firm's capital structure consists of 30% debt, 10% preferred stock and 60% equity. the form's bond yield 10% on average before taxes, the cost preferred stock is 8% and the cost of equity is 16%. Calculate the form's WACC assuming a tax rate of 40%.

FIN3403

Suppose a firm's capital structure consists of 30% debt, 10% preferred stock and 60% equity. the form's bond yield 10% on average before taxes, the cost preferred stock is 8% and the cost of equity is 16%. Calculate the form's WACC assuming a tax rate of 40%.

Answer: (0.6 16%+0.310% (1-0.4)+0.18% = 12.20%.

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FIN MCQ

Suppose a firm's capital structure consists of 30% debt, 10% preferred stock and 60% equity. the form's bond yield 10% on average before taxes, the cost preferred stock is 8% and the cost of equity is 16%. Calculate the form's WACC assuming a tax rate of 40%.

Suppose a firm's capital structure consists of 30% debt, 10% preferred stock and 60% equity. the form's bond yield 10% on average before taxes, the cost preferred stock is 8% and the cost of equity is 16%. Calculate the form's WACC assuming a tax rate of 40%.

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