9. Delta Corporation has common stock of $50 million, preferred stock of $20 million, and total...

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Answer 1

Answer #1

After-tax cost of debt=16*(1-tax rate)

=16*(1-0.4)=9.6%

Total value=(50+20+30)=$100 million

WACC=Respective costs*Respective weight

=(50/100*12)+(20/100*9)+(30/100*9.6)

=10.68%

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Answer 2

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