M\&F Inc.'s target capital structure is 40% debt, 15% preferred stock, and 45% common equity....
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M\&F Inc.'s target capital structure is 40% debt, 15% preferred stock, and 45% common equity. The interest rate on new debt is 7%, the yield on the preferred stock is 10%, the opportunity cost of common equity from retained earnings is 12%, and the tax rate is 40%. The firm will not be issuing any new common stock. What is the firm's WACC? a) 8.34% b) 9.17% c) 8.15% d) 8.58% e) 9.54%
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