What is the WACC for Bacon Signs Inc, if the after-tax cost of long-term debt is 6.3% and the before tax cost of equity is 10.4%
A) 8.02%
B) 8.91%
C) 9.58%
D) Without a corporate tax rate, we cannot answer this question as written.
B
Explanation: B) WACC = 6.3% * 36.4% + 10.4% * 63.6% = 8.91%.
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