Question

​AllCity, Inc., is financed

41%

with​ debt,

9%

with preferred​ stock, and

50%

with common stock. Its cost of debt is

6.5%​,

its preferred stock pays an annual dividend of

$2.55

and is priced at

$33.

It has an equity beta of

1.18.

Assume the​ risk-free rate is

2.5%​,

the market risk premium is

7.3%

and​ AllCity's tax rate is

35%.

What is its​ after-tax WACC?

​Note: Assume that the firm will always be able to utilize its full interest tax shield.

The WACC is

nothing​%.

​(Round to two decimal​ places.)

Answer 1

answered by: anonymous