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A firm has to re-evaluate its weighted average cost of capital following a significant issue of debt. The firm now has financed 40% of its assets using debt and 60% using equity. Calculate the firms weighted average cost of capital where the firm's borrowing rate on debt is 8.6%, it faces a 35% tax rate, and the common stockholders require a 19.5% rate of return.

The firms weighted average cost of capital is?

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Category:- Basic Finance
Reference No.:- M9791524

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