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Debt Equity Project Percent Rate Percent Rate 203 100 10.9 206 50 7.0 50 8.5 306 65 11.6 35 7.5 367 25 8.2 75 6.0 456 100 8.9 913 10 5.5 90 7.2 914 75 11.4 25 8.4 987 80 10.5 20 8.1

Debt Equity Project Percent Rate Percent Rate 203 100 10.9 206 50 7.0 50 8.5 306 65 11.6 35 7.5 367 25 8.2 75 6.0 456 100 8.9 913 10 5.5 90 7.2 914 75 11.4 25 8.4 987 80 10.5 20 8.1

Essentials Of Investments
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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Dougherty Construction has worked on several international housing projects during the last year. The D-E mixes and rates are shown. Plot the WACC curve and identify the D-E mix that had the lowest WACC.

Debt Equity Project Percent Rate Percent Rate 203 100 10.9 206 50 7.0 50 8.5 306 65 11.6 35 7.5 367 25 8.2 75 6.0 456 100 8.9 913 10 5.5 90 7.2 914 75 11.4 25 8.4 987 80 10.5 20 8.1
Transcribed Image Text:Debt Equity Project Percent Rate Percent Rate 203 100 10.9 206 50 7.0 50 8.5 306 65 11.6 35 7.5 367 25 8.2 75 6.0 456 100 8.9 913 10 5.5 90 7.2 914 75 11.4 25 8.4 987 80 10.5 20 8.1
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