Retained earnings and the rest in debt

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A firm has a target capital structure that consists of 65% of retained earnings and the rest in debt. The firm's cost of retained earnings is9.7%. The firm's cost of new debt is similar to the yield to maturity of its existing bonds, which is 4.6%. The firm's tax rate is 35%. Given this information, and given that the firm has no preferred stock, what is the WACC?

Reference no: EM132073353

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