CoffeeCarts has a cost of equity of 15.9%, has an effective cost of debt of 4.2%, and is financed 66% with equity and 34% with debt. What is this firm's WACC? CoffeeCarts's WACC is __% ? (Round to one decimal place.)

CoffeeCarts has a cost of equity of 15.9%, has an effective cost of debt of 4.2%, and is financed 66% with equity and 34% with debt. What is this firm's WACC? CoffeeCarts's WACC is __% ? (Round to one decimal place.)

Essentials Of Investments

11th Edition

ISBN:9781260013924

Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.

Chapter1: Investments: Background And Issues

Section: Chapter Questions

Problem 1PS

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Question

CoffeeCarts has a cost of equity of 15.9%, has an effective cost of debt of 4.2%, and is financed 66% with equity and 34% with debt. What is this firm's WACC?

CoffeeCarts's WACC is __% ?

(Round to one decimal place.)

Definition Definition Amount of return a company generally pays to its equity investors. The cost of equity represents the compensation required by the market in lieu of owning the asset firm and simultaneously bearing the risk of ownership.

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