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  3. a given firms beta is .7 (a little on the safe sid

A given firms beta is .7 (a little on the safe side); risk free rates...

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Accounting

A given firms beta is .7 (a little on the safe side); risk free rates are 2%; and the market, in general, returns 8%. The company has $20 million in debt and $15 million in equity where the interest rate on the debt is 7% and the tax rate is 35%. Using the Capital Asset Pricing Method for determining the cost of equity, what is the firms weighted average cost of capital?

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