Answer to Question #198046 in Finance for Natalie

Question #198046

Calculate WACC?

Given corporate tax 35%.

Debt MV 20m (RRR6%)

Preferred stock MV 10m (RRR8)

Common stock MV 50m (RRR12)


1
Expert's answer
2021-05-25T16:59:52-0400

Corporate tax rate can be defined as that rate at which a corporate or a firm is required to pay taxes to the government of a country. These taxes serve as revenue for the government and is used for expenses.


WACC can be calculated as follows:




Therefore, WACC is 9.475%


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