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Investors should expect that bonds with a call provision and currently selling for a discount to be called. True False
1. The basic WACC equation Aa Aa E The calculation of WACC involves calculating the weighted average of the required rates of
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Answer #1

1.

True

If bond is at discount it will most likely be called.

2.

Ce represents cost of equity.

3.

Weight of Preferred Stock = 2/(1.4 + 2 + 2.2)

Weight of Preferred Stock = 0.36

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