Which offered you after tax cash flows for evaluation

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Reference no: EM131836606

AMNI Corporation has supplied the following information to you.

We pay our lenders 5 percent per year for our short-term borrowings.

We pay our lenders 7 percent per year for our long-term borrowings.

Our preferred stock sells for $39 per share and pays a $3.00 dividend.

Our common stock sells for $22 per share and pays a $1.10 dividend.

Our dividend has grown from $0.70 five years ago.

Our firm has a 30 percent tax rate.

In addition the firm has shared with you the following information regarding its capital structure.

type of capital amount of capital

short term debt $125

long term debt $275

preferred stock $50

common stock $300

retained earnings $250

What cost of capital would you use to evaluate a project which offered you after tax cash flows for evaluation?

Reference no: EM131836606

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