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the answer of 5-22 c. Assuming that GAO will not issue new equity and...

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Finance

imagethe answer of 5-22

c. Assuming that GAO will not issue new equity and will continue to use the same tar get capital structure, what is the company's WACC? MINI CASE During the last few years, Jana Industries has been too constrained by the high cost of capital to make many capital investments. Recently, though, capital costs have been declining, and the company has decided to look seriously at a major expansion program proposed by the marketing department. Assume that you are an assistant to Leigh Jones. the financial vice president. Your first task is to estimate Jana's cost of capital. Jones has provided you with the following data, which she believes may be relevant to your task: The firm's tax rate is 25%. The current price of Jana's 12% coupon, semiannual payment, noncallable bonds with 15 years remaining to maturity is S1.153.72. There are 70.000 bonds. Jana does not use Como engage Loaming All Rights Reserved. May be copiered in whole or in WON 12000 20 Marbeitet werden SMS 104895 A

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