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Business, 12.08.2020 08:01 hePandaKing6909

Targaryen Corporation has a target capital structure of 70 percent common stock, 5 percent preferred stock, and 25 percent debt. Its cost of equity is 10 percent, the cost of preferred stock is 6 percent, and the pretax cost of debt is 7 percent. The relevant tax rate is 22 percent. Required:
a. What is the company's WACC?
b. What is the aftertax cost of debt?

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