Targeted a capital structure of common equity and debt

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Your company has targeted a capital structure of 30% common equity and 70% debt. Its marginal tax rate is 38%. It has an outstanding bond that matures in exactly 14 years. it is a 6% annual coupon bond selling at 90% of par value. The company views its current cost of equity as being at a 6% premium to its pre tax cost of debt. Calculate the WACC.

Reference no: EM13947238

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