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A firm's stockholders expect a 15 percent rate of return, and there is a $22 M in common stock and retained earnings. The firm has $9M in loans at an average rate of 7 percent. The firm has raised $14M by selling bonds at an average rate of 5 percent. What is the firm's cost of capital after taxes with a tax rate of 40 percent?

Microeconomics, Economics

  • Category:- Microeconomics
  • Reference No.:- M91225668

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