medium · CFA Level I Corporate Issuers
Helion Rail has a target capital structure of 30% debt and 70% equity. The pre-tax cost of debt is 6%, the equity risk premium is 5%, the risk-free rate is 3%, and the marginal tax rate is 25%.
If the company's beta is 1.2, its WACC is closest to:
- 7.65%
- 8.10%
- 9.00%
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