9. Taxes and WACC Caddie Manufacturing has a target debt-equity ratio of .45. Its cost of equity is 10.3 percent, and its pretax cost of debt is 6.4 percent. If the tax rate is 21 percent, what is the company's WACC?

9. Taxes and WACC Caddie Manufacturing has a target debt-equity ratio of .45. Its cost of equity is 10.3 percent, and its pretax cost of debt is 6.4 percent. If the tax rate is 21 percent, what is the company's WACC?

Corporate Fin Focused Approach

5th Edition

ISBN:9781285660516

Author:EHRHARDT

Publisher:EHRHARDT

Chapter9: The Cost Of Capital

Section: Chapter Questions

Problem 7P

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you tell the president?
9. Taxes and WACC Caddie Manufacturing has a target debt-equity ratio
of .45. Its cost of equity is 10.3 percent, and its pretax cost of debt is 6.4
percent. If the tax rate is 21 percent, what is the company's WACC?
hog o WACC of 8 05

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