What is the WACC for a firm with 40% debt, 20% preferred stock, and 40% equity if the respective costs for these components are 6% after tax, 12% after tax, and 18% before tax? The firm's tax rate is 35%. 12.60% 11.48% 10.22% 10.52%
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What is the WACC for a firm with 40% debt, 20%
12.60%
11.48%
10.22%
10.52%
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- What is the weighted average cost of capital for a firm with 40% debt, 20% preferred stock, and 40% common equity if the respective costs for these components are 8% after-tax, 13% after-tax, and 17% before-tax? The firm's tax rate is 35%. answer: 12.6%Suppose Essen Corp has the following weights and costs. What is the WACC if the company has a 21% tax rate? Component Common equity Debt (before tax) R 11.5% 0.8 0.2 7.5% 10.39% ()8.71% ()6.25% 9.50% 10.70% Page 29 of 30 Previous Page Next PageA firm has a total market value of $10 million while its debt has a market value of $4 million. What is the after-tax weighted average cost of capital if the before-tax cost of debt is 10% the cost of equity is 15%, and the tax rate is 21%? Multiple Choice A) 10.4% B) 8.8% C) 12.2% D) 13.0%
- which one is correct please confirm? QUESTION 4 A firm with a 40% marginal tax rate has a capital structure of $60,000,000 in debt and $140,000,000 in equity. What is the firm's weighted cost of capital if the marginal pretax cost of debt is 12%, the firm's average pretax cost of debt outstanding is 8%, and the cost of equity is 14.5%? a. 10.45% b. 11.59% c. 12.31% d. 13.75%Plz Use excel !!! and show formula A company currently has a WACC of 10.6 percent and no debt. The tax rate is 21 percent. a. What is the company’s current cost of equity? b. If the firm converts to 40 percent debt with a cost of 6%, what will its cost of equity be? And the WACC? c. If the firm converts to 60 percent debt with a cost of 6% , what will its cost of equity be? And the WACC? d. What can you conclude from the values of the cost of equity and WACC obtained in b. and c.What is the weighted average cost of capital for a firm with 40% debt, 20% preferred stock, and 40% common equity if the respective costs for these components are 8% after-tax, 13% after-tax, and 17% before-tax? The firm's tax rate is 35%.
- A firm wants to create a WACC of 11.4%. The firm's cost of equity is 14.7% and the pre- tax cost of debt is 7.5%. The tax rate is 34%. What does its target debt ratio need to be for the firm to achieve its target WACC of 11.4%? a. 35.35% b. 33.85% c. 53.88% d. 46.12%Salalah Mineral water has found that its cost of common equity capital is 18 percent, and its cost of debt capital is 8 percent. If the firm is financed with 60 percent common shares and 40 percent debt, then what is the after-tax weighted average cost of capital for Salalah Mineral water if it is subject to a 40 percent marginal tax rate? Select one: O a. 12.72 O b. 14.57 Oc 11.50 O d. None of theseGiven the following information, compute the firm's WACC: • The firm's cost of equity = 16% • The firm's before-tax cost of long-term debt = 7% • The firm's capital structure is 35% long-term debt and 65% common equity • The firm's marginal tax rate = 25% O 10.25% O 12.85% 12.24% O 13.28%
- What proportion of a firm is equity financed if the WACC is 14%, the after-tax cost of debt is 7.0%, the tax rate is 35%, and the required return on equity is 17%? (Answer as a whole percentage, i.e. 5.25%, not 0.0525)Majan Mining has found that its cost of common equity capital is 17 percent and its cost of debt capital is 6 percent. If the firm is financed with OMR 3,000,000 of common shares (market value) and OMR 2,000,000 of debt, then what is the after-tax weighted average cost of capital for Majan Mining if it is subject to a 40 percent marginal tax rate? Select one: O a. 11.50 b. 14.57 O c. 11.64 O d. None of theseMajan Mining has found that its cost of common equity capital is 15 percent and its cost of debt capital is 12 percent. If the firm is financed with $250,000,000 of common shares (market value) and $750,000,000 of debt, then what is the after-tax weighted average cost of capital for Majan Mining if it is subject to a 35 percent marginal tax rate? Select one: a. 10.50 b. 9.60 c. 11.57 d. None of these