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What is its weighted average cost of capital

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Reference no: EM132730914

Problem - Elliott's Cross Country Transportation Services has a capital structure with 25% debt at a 9% interest rate. Its beta is 1.6, the risk-free rate is 4%, and the market risk premium is 7%. Elliott's combined federal-plus-state tax rate is 25%.

Required -

a. What is Elliott's cost of equity?

b. What is its weighted average cost of capital?

c. What is its unlevered cost of equity?

Reference no: EM132730914

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