The target capital structure consists of 40 debt and 60


Jedi Enterprises stock trades for $38 per share. It is expected to pay a $1.7 dividend at year end, and the dividend is expected to grow at a constant rate of 2.9% a year. The before-tax cost of debt is 6%, and the tax rate is 24%. The target capital structure consists of 40% debt and 60% common equity. What is the company's WACC (in percent) if all the equity used is from reinvested earnings?

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Management Theories: The target capital structure consists of 40 debt and 60
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