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Pfd Company has debt with a yield to maturity of 5.7%?, a cost of equity of...

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Finance

Pfd Company has debt with a yield to maturity of 5.7%?, a costof equity of 13.5%?, and a cost of preferred stock of 8.7%. Themarket values of its? debt, preferred? stock, and equity are $10.2?million, $2.6 ?million, and $15.2 ?million, respectively, and itstax rate is 40%. What is this? firm's after-tax? WACC?

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4.2 Ratings (774 Votes)
According to the given information Pretax Cost of debt 57 Cost of equity 135 Cost of preferred stock 87 Value of debt 102 million Value of preferred stock 26 million Value of equity 152 million Total value    See Answer
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Pfd Company has debt with a yield to maturity of 5.7%?, a costof equity of 13.5%?, and a cost of preferred stock of 8.7%. Themarket values of its? debt, preferred? stock, and equity are $10.2?million, $2.6 ?million, and $15.2 ?million, respectively, and itstax rate is 40%. What is this? firm's after-tax? WACC?

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