Feast Inc
Subject:FinancePrice:2.86 Bought3
Feast Inc. plans to maintain its optimal capital structure of 40% debt, 10% preferred stock, and 50% common equity indefinitely. The pre-tax required return on each component source of capital is as follows: debt ------ 8%; preferred stock ------ 12%; common equity ------ 16%. Assuming a 40% marginal tax rate, what after-tax weighted average cost of capital can we infer for the firm?
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