For company whose target capital structure

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Reference no: EM131552699

For a company whose target capital structure calls for 50% debt and 50% common equity, which of the following statements is CORRECT? The WACC is calculated on a before-tax basis. The cost of equity is always equal to or greater than the cost of debt. None of the above. The WACC exceeds the cost of equity. The interest rate used to calculate the WACC is the average after-tax cost of all the company's outstanding debt as shown on its balance sheet.

Reference no: EM131552699

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