(Answered) A company is 37 financed by risk-free debt the interest

Management Studies

A company is 37% financed by risk-free debt. The interest rate is 12%, the expected market risk premium is 10%, and the beta of the company's common stock is .62.

a. What is the company cost of capital?

b. What is the after-tax WACC, assuming that the company pays tax at a 35% rate?

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