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Olsen Outfitters Inc. believes that its optimal capital structure consists of 70% common equity and...

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Finance

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Olsen Outfitters Inc. believes that its optimal capital structure consists of 70% common equity and 30% debt, and its tax rate is 25%. Olsen must raise additional capital to fund Its upcoming expansion. The firm will have $2 million of retained earnings with a cost of rs - 10%. New common stock in an amount up to $6 million would have a cost of re- 13.0%. Furthermore, Olsen can raise up to $4 million of debt at an interest rate of ra -9% and an additional 54 million of debt at - 13%. The CFO estimates that a proposed expansion would require an investment of $10.8 million. What is the WACC for the last dollar raised to complete the expansion? Round your answer to two decimal places

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