AllCity, Inc., is financed 37% with​ debt, 11% with preferred​ stock, and 52% with common stock. Its pretax cost of debt is 6.3%​, its preferred stock pays an annual dividend of $2.46 and is priced at $35. It has an equity beta of 1.19. Assume the​ risk-free rate is 1.9%​, the market risk premium is 6.9% and​ AllCity's tax rate is 25%. What is its​ after-tax WACC? ​Note: Assume that the firm will always be able to utilize its full interest tax shield

Essentials Of Investments
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Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
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AllCity, Inc., is financed 37% with​ debt, 11% with preferred​ stock, and 52% with common stock. Its pretax cost of debt is 6.3%​, its preferred stock pays an annual dividend of $2.46 and is priced at $35. It has an equity beta of 1.19. Assume the​ risk-free rate is 1.9%​, the market risk premium is 6.9% and​ AllCity's tax rate is 25%. What is its​ after-tax WACC? ​Note: Assume that the firm will always be able to utilize its full interest tax shield

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