Cost of debt Tax Rate Cost of equity Debt/EV Part a. Source Debt Equity Part b. Source Debt Equity PROBLEM 4-3 Given 6% 30% 14% 20% Solution Proportion After-tax cost Product Solution Legend ■ Value given in problem Formula/Calculation/Analysis required Qualitative analysis or Short answer required = Goal Seek or Solver cell = Crystal Ball Input = Crystal Ball Output Solution WACC Proportion After-tax cost Product WACC
Cost of debt Tax Rate Cost of equity Debt/EV Part a. Source Debt Equity Part b. Source Debt Equity PROBLEM 4-3 Given 6% 30% 14% 20% Solution Proportion After-tax cost Product Solution Legend ■ Value given in problem Formula/Calculation/Analysis required Qualitative analysis or Short answer required = Goal Seek or Solver cell = Crystal Ball Input = Crystal Ball Output Solution WACC Proportion After-tax cost Product WACC
Chapter1: Financial Statements And Business Decisions
Section: Chapter Questions
Problem 1Q
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