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    Finance problem: Weighted average cost of capital.

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    (Calculating the WACC) The required return on debt is 8%, the required return on equity
    is 14%, and the marginal tax rate is 40%. If the firm is financed 70% equity and 30% debt,
    what is the weighted average cost of capital?

    Please show how you got your answer in excel.

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    Solution Summary

    The problem deals with estimating the weighted cost of capital for a firm.