Verano inc has two business divisions - a software product, Ask an Expert

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Verano Inc. has two business divisions - a software product line and a waste water clean-up product line. The software business has a cost of equity capital of 11% and the waste water clean-up business has a cost of equity capital of 6%. Verano has 50% of its revenue from software and the rest from the waste water business. Verano is considering a purchase of another company in the waste water business using equity financing. What is the appropriate cost of capital to evaluate the business?

9.3%

11%

8.5%

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Financial Management, Finance

Category:- Financial Management
Reference No.:- M91608178

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