What is the company cost of capital

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Reference no: EM13765119

A company is 36% financed by risk-free debt. The interest rate is 9%, the expected market risk premium is 7%, and the beta of the company’s common stock is 0.63.

a. What is the company cost of capital?

b. What is the after-tax WACC, assuming that the company pays tax at a 34% rate?

Reference no: EM13765119

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