Life Balance Inc Has Found That Its Cost Of Common Equity Capital Is 15 Percent
Life Balance, Inc. has found that its cost of common equity capital is 15 percent and its cost of debt capital is 9 percent. If the firm is financed with $6 million of common shares (market value) and $4 million of debt, what is the after tax weighted average cost of capital (WACC) for the company if it is subject to a 30 percent marginal tax rate? 9.7% 10.65% 11.16% 11.52%
Life Balance, Inc. has found that its cost of common equity capital is 15 percent and its cost of debt capital is 9 percent. If the firm is financed with $6 million of common shares (market value)…
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