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Find What is after-tax WACC

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Problem 1: AllCity Inc. is financed 50% with debt, 15% with preferred stock, and 35% with common stock. Its pre-tax cost of debt is 6%; its preferred stock pays an annual dividend of $2.25 and is priced at $32. It has an equity beta of 1.1. Assume the risk-free rate is 2%, the market risk premium is 6%, and AllCity's tax rate is 35?%. What is its after-tax WACC?

Reference no: EM132719473

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