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What is Pinder Ltd weighted average cost of capital

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Reference no: EM133060197

Question - Pinder Ltd operates under the classical tax system. The market value of Pinder Ltd's debt and equity are $2,000,000 and $3,000,000, respectively. The before-tax cost of borrowing for Pinder Ltd is 8% and the cost of equity is 15%. If Pinder Ltd's tax rate is 30%, what is Pinder Ltd's weighted average cost of capital?

Reference no: EM133060197

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