Star corporation has a target capital structure of 30, Ask an Expert

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Star Corporation has a target capital structure of 30 percent common stock, 10 percent preferred stock, and 60 percent debt. Its cost of equity is 14 percent, the cost of preferred stock is 8.0 percent, and the pre-tax cost of debt is 7.0 percent. What is the firm's WACC given a tax rate of 35 percent? (Ch14)

a. 7.73 percent

b. 9.12 percent

c. 9.78 percent

d. 10.38 percent

e. 11.18% percent

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Financial Management, Finance

Category:- Financial Management
Reference No.:- M92360021

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