Target capital structure-cost of common equity

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Reference no: EM131082836

Percy Motors has a target capital structure of 30% debt and 70% common equity, with no preferred stock. The yield to maturity on the company's outstanding bonds is 10%, and its tax rate is 40%. Percy's CFO estimates that the company's WACC is 13.60%. What is Percy's cost of common equity?

Reference no: EM131082836

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