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Business, 18.12.2019 18:31 geezelouise808

Allcity, inc., is financed 35 % with debt, 10 % with preferred stock, and 55 % with common stock. its cost of debt is 6.4 %, its preferred stock pays an annual dividend of $ 2.49 and is priced at $ 28. it has an equity beta of 1.16. assume the risk-free rate is 2.4 %, the market risk premium is 7.4 % and allcity's tax rate is 35 %. what is its after-tax wacc? note: assume that the firm will always be able to utilize its full interest tax shield.

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Allcity, inc., is financed 35 % with debt, 10 % with preferred stock, and 55 % with common stock. it...
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