Life balance inc. has found that its cost of common equity, Ask an Expert

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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%

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Category:- Basic Finance
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