Calculate the weighted average cost of capital (WACC) for Apex Printing given these assumptions. Weights of 40% debt and 60% common equity, a 35% tax rate, cost of debt is 8% Beta of the company is 1.5 Risk free rate is 2% and return on the market is 11%. Indicate how these cost of capital might be used to determine the feasibility of the capital project.
Weight of equity=we=60%=0.60
Risk free rate=rf=2%
Required return on ...
The solution depicts the steps to estimate the WACC in the given case.