The cost of debt capital is 10%.

Reference no: EM13716724

VWX Corporation has an EBIT of $166,666.67, a corporate tax rate of 40%, debt of $500,000, and unlevered cost of capital of 20%. The cost of debt capital is 10%.
(10 marks)

a. What is the value of VWX's equity?

b. What is the cost of equity capital for VWX?

c. What is the WACC?

Reference no: EM13716724

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