Calculate its after-tax weighted average cost of capital

Assignment Help Financial Management

Reference no: EM131327051

Part I. Given the tax rate of 40% of this corporation, calculate its after-tax weighted average cost of capital (WACC) for Duke Corporation.

Table: the before-tax weighted average cost of capital (WACC) for Duke Corporation

Source of Capital Weight (1) Cost (2) Weighted Cost (1) X (2)

Long-Term Debt .4 5.6% 2.24%

Preferred Stock .1 10.6% 1.06%

Common Stock Equity .5 13% 6.5%

Totals 1 - 9.8%

Part II. Answer true, false or uncertain and explain briefly on the following statement. "the after-tax wacc cannot ever be higher than the before-tax wacc."

Reference no: EM131327051

Questions Cloud

Write a paper in response to the hypothetical situation : Write a paper in response to the hypothetical situation.- An opportunity to synthesize and apply the concepts, principles, and theories. Write a paper in response to the given hypothetical situation.

Function of investment banks-mutual funds-hedge funds : Contrast the structure and function of investment banks, mutual funds, hedge funds, pension funds and insurance companies. Support your discussion with examples from scholarly sources other than the course text, such as reputable news organizations, ..

When would scenario planning not be a relevant practice : Identify an industry that is undergoing intense competition or is being featured in the business press. Discuss how scenario planning could be used by competitors to prepare for future events.

Environmental factors that can affect the health of infants : Develop a pamphlet to inform parents and caregivers about environmental factors that can affect the health of infants. Explain how the environmental factor you selected can potentially affect the health or safety of infants

Calculate its after-tax weighted average cost of capital : Given the tax rate of 40% of this corporation, calculate its after-tax weighted average cost of capital (WACC) for Duke Corporation. Answer true, false or uncertain and explain briefly on the following statement. "the after-tax wacc cannot ever be hi..

Write a reaction paper on the given video : Write a reaction paper on this video, and specifically on Mr. Burtynsky's work as it relates to our discussion on Landscape. Make sure you read in your book, and utilize concepts, which can be applied to his work, here.

How do facebooks operations promote or hinder : Make a case in favor of Facebook taking more responsibility for the fake news stories. On what principles would these responsibilities be based? What actions would be required?Talk about Facebook's role in a functioning democracy. How do Facebook'..

Gather and analyze data for database performance : Gather and analyze data for database performance and tuning - Configure and tune a database for optimal performance.

Write an essay about violence on television : English 101- Write an essay about Violence on Television. Return this form to me with your name and the date you want to deliver your presentation (or give me the information on a separate sheet of paper).

User Account

All Pages