1answer.
Ask question
Login Signup
Ask question
All categories
  • English
  • Mathematics
  • Social Studies
  • Business
  • History
  • Health
  • Geography
  • Biology
  • Physics
  • Chemistry
  • Computers and Technology
  • Arts
  • World Languages
  • Spanish
  • French
  • German
  • Advanced Placement (AP)
  • SAT
  • Medicine
  • Law
  • Engineering
lora16 [44]
3 years ago
5

GenX has a target capital structure of 40 percent common stock, 5 percent preferred stock, and 55 percent debt. Its cost of equi

ty is 22 percent, the cost of preferred stock is 8.5 percent, and the pre-tax cost of debt is 8 percent. What is the firm's WACC given a tax rate of 35 percent
Business
1 answer:
AVprozaik [17]3 years ago
6 0

Answer:

12.085 %

Explanation:

WACC = Cost of Equity x Weight of Equity + Cost of Preference Stock x Weight of Preference Stock + Cost of Debt x Weight of Debt

Remember to use the after tax cost of debt :

after tax cost of debt = interest x ( 1 - tax rate)

                                   = 8.00 % x (1 - 0.35)

                                   = 5.20 %

therefore,

WACC = 22.00 % x 0.40 + 8.50 % x 0.05 + 5.20 % x 0.55

           = 12.085 %

thus

the firm's WACC given a tax rate of 35 percent is 12.085 %

You might be interested in
Clients are increasingly asking advertisers for ______, agreements on campaign-specific outcomes and consensus on how the effect
Minchanka [31]

Answer:

accountability metrics

Explanation:

Accountability metrics  are used by companies to measure the specific financial results of marketing campaigns. Marketing campaigns are expensive and require a lot of resources, both financial and labor resources, and as competition between producers increases, so does competition among marketing firms. The best way a marketing firm can increase its clients is by showing that their campaigns are effective, so every dollar invested by their clients will generate positive returns.

6 0
2 years ago
The marketing channel is the upstream portion of the supply chain that is charged with moving component parts or raw materials t
xenn [34]
(b.) FALSE

The marketing channel is a downstream portion of a supply chain that reaches from point of production to the consumer. It connects the product to the customer. The downstream process refers to the processing of materials and make a finished product.
7 0
3 years ago
MCQ
yulyashka [42]

Answer:

none of the above

Explanation:

because the organization must know how much they own

8 0
2 years ago
What two trends in the past decade have significantly influenced global marketing?
SOVA2 [1]

The two trends that influenced global marketing in the last decade were:

  • Formal economic integration.

  • Free trade between nations.

Global marketing can be defined as a management strategy for organizations that also market their products and services in foreign countries.

Globalization has enabled formal economic integration and free trade between nations, and has created the possibility for companies to increase their profitability and market share.

As an example, we can mention the fast-food chain <em>Mc Donalds,</em> which has a presence almost all over the world, but which adapts its burgers according to local habits.

Therefore, a global company must adopt global marketing, that is, adapt to local customs, culture and preferences for the business to be successful.

Learn more here:

brainly.com/question/1528741

4 0
2 years ago
What value of a measurement must be available if the accuracy of a measurement is to be determined?
Agata [3.3K]
The answer is the correct value
<span>To evaluate the accuracy of a measurement, the measured value must be compared to the correct value and  you must compare the values of two or more repeated measurements
By doing this, you will have a set of standard to follow to make sure that the result of your research still placed within the scope of standards that accepted by experts in your field, which reduce the likelihood of your result to be considered as invalid.</span>
6 0
3 years ago
Other questions:
  • You see information everywhere. Sometimes it is useful and sometimes it is not. Think of a scenario in which you think informati
    12·1 answer
  • Suppose the rate of return on a 10-year T-bond is 4.05%, the expected average rate of inflation over the next 10 years is 2.0%,
    14·1 answer
  • In the ____ stage of selecting information technology projects, organizations define project scope, benefits, and constraints. a
    13·1 answer
  • Selma operates a contractor's supply store. She maintains her books using the cash method. At the end of 2020, her accountant co
    15·1 answer
  • Janes Company provided the following information on intangible assets: A patent was purchased from the Lou Company for $1,100,00
    7·1 answer
  • g Other things the same, if the exchange rate changes from 6 Chinese yuan per dollar to 7 Chinese yuan per dollar, then the doll
    9·1 answer
  • 1.Choose one option that defines Pathos:
    10·1 answer
  • What is the most important way the federal reserve ensures the United States money supply is safe and in circulation
    6·1 answer
  • Theoretically high taxes slow the economy because
    14·1 answer
  • seasonal indices of sales for the black lab ski resort are for 1.20 for january and .80 for december. if december sales for 1998
    9·1 answer
Add answer
Login
Not registered? Fast signup
Signup
Login Signup
Ask question!