Shadow corp has no debt but can borrow at 65 the firms wacc, Ask an Expert

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Shadow corp. has no debt but can borrow at 6.5%. The firm's WACC is currently 10.4% and the tax rate is 35%

a) What is Shadows cost of equity?
b) If the firm converts to 25% debt, what will its cost of equity be?
c) If the firm converts to 50% debt, what will its cost of equity be?
d) What is Shadow's WACC in part (b)? In part(c)?

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Basic Finance, Finance

Category:- Basic Finance
Reference No.:- M9878808

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