calculate the weighted average cost of capital for a firm having a capital structure consisting...
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Accounting
calculate the weighted average cost of capital for a firm having a capital structure consisting of 40% debt, 10% preferred stock and 50% equity. Assume further that debt bears an interest of 8%, that preferred stock pays an $8 dividend and is priced at $100 (its par value), and that common stock sells for $55, paying a dividend of $2.20. Finally, assume that the expected growth rate of earnings and dividends is 9%, and that the firm's effective tax rate is 34%.
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