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The Wintergreen Organization,whose Tax Rate Is 30%,generates Two Sources of Funds

Question 74

Multiple Choice

The Wintergreen Organization,whose tax rate is 30%,generates two sources of funds: long-term debt with a market value of $7,000,000 and an interest rate of 8%,and equity capital with a market value of $12,000,000 and a cost of equity of 11%.What is Wintergreen's weighted cost of capital (WACC) ?


A) .050
B) .060
C) .070
D) .080
E) .090

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