Determining the firm weighted average cost of capital
Problem: A firm has debt of $5,000, equity of $16,000, a cost of debt of 8%, a cost of equity of 12%, and a tax rate of 34%. What is the firm's weighted average cost of capital?
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A firm has debt of $5,000, equity of $16,000, a cost of debt of 8%, a cost of equity of 12%, and a tax rate of 34%.
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