Lender Steven Yang Shepherd Bailey Amount $4,194,670 $3,446,268 $2,669,973 $1,389,089 Interest Rate 13% 11% 8% 9%

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
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K
WACC. Grey's Pharmaceuticals has a new project that will require funding of $11.7 million. The company has decided
to pursue an all-debt scenario. Grey's has made agreements with four lenders for the needed financing. These lenders
will advance the following amounts at the interest rates shown:
Click on the Icon in order to copy its content into a spreadsheet.
Lender
Amount
Interest Rate
$4,194,670
$3,446,268
$2,669,973
$1,389,089
What is the weighted average cost of capital for the $11,700,000?
Steven
Yang
Shepherd
Bailey
13%
11%
8%
9%
What is the weighted average cost of capital for the $11,700,000?
% (Round to two decimal places.)
26
Transcribed Image Text:K WACC. Grey's Pharmaceuticals has a new project that will require funding of $11.7 million. The company has decided to pursue an all-debt scenario. Grey's has made agreements with four lenders for the needed financing. These lenders will advance the following amounts at the interest rates shown: Click on the Icon in order to copy its content into a spreadsheet. Lender Amount Interest Rate $4,194,670 $3,446,268 $2,669,973 $1,389,089 What is the weighted average cost of capital for the $11,700,000? Steven Yang Shepherd Bailey 13% 11% 8% 9% What is the weighted average cost of capital for the $11,700,000? % (Round to two decimal places.) 26
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