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You would like to estimate the weighted average cost of capital for a new airline business. Based on its industry asset? beta, you have already estimated an unlevered cost of capital for the firm of 9 %. However, the new business will be 27 % debt? financed, and you anticipate its debt cost of capital will be 6 %. If its corporate tax rate is 36 %?, what is your estimate of its? WACC?

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Financial Management, Finance

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