What is shadow cost of equity

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Reference no: EM13679425

1. Shadow Corp. has no debt but can borrow at 8%. The firm's WACC is currently 12% and the firm pays no taxes. (a) What is Shadow's cost of equity? (b) If the firm converts to 25% debt, what will its cost of equity be? (c) What is Shadow's WACC if it converts to the 25% debt?

Reference no: EM13679425

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