Question

A firm has an equity ratio of 0.72. Assuming the cost of equity is 9%, the cost of debt is 4%, and the company tax rate is 30%, then what is the firm's wacc

Answer 1

Explanation:

Re=Cost of equity. Rd=Cost of debt. E=Market value of equity, or the market price of a stock (found on ticker page) multiplied by the total number of shares outstanding (found on balance sheet) D=Market value of debt, or the total debt of a company (found on balance sheet)