Quantitative Problem: Barton Industries expects that its target capital structure for raising funds in the...
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Quantitative Problem: Barton Industries expects that its target capital structure for raising funds in the future for its capital budget will consist of 40% debt, 5% preferred stock, and 55% common equity. Note that the firm's marginal tax rate is 25%. Assume that the firm's cost of debt. Po, is 9.2%, the firm's cost of preferred stock, fo is 8.4% and the firm's cost of equity is 11.8% for old equity, rs, and 12.40s for new equilty, te What is the firm's weighted average cost of capital (WACC:) if it uses retained earnings as its source of common equity? Do not round intermediate calculations. Round your answer to two decimal places. % What is the firm's weighted average cost of capital (WACC) W it has to issue new common stock? Do not round Intermediate calculations. Round your answer to two decimal places
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