Business, 06.12.2019 00:31 isiahamccoy2149

Meyer & co. expects its ebit to be $111,000 every year forever. the firm can borrow at 8 percent. the company currently has no debt, and its cost of equity is 12 percent and the tax rate is 22 percent. the company borrows $165,000 and uses the proceeds to repurchase shares. a. what is the cost of equity after recapitalization? (do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e. g., 32.16.) b. what is the wacc? (do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e. g., 32.16.)

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