Gce Model Questions Vol1 2017 Commerce Question 45
Practice objective / multiple choice question 45 from the 2017 Gce Model Questions Vol1 Commerce examination.
A company requires \(₦10,000,000\) of financing. It can raise 60\% of the amount through a bank loan at an interest rate of 12\% per annum and the remaining 40\% by issuing shares that investors require a return of 18\%. The corporate tax rate is 30\%, and interest on the loan is tax‑deductible. Determine the after‑tax cost of debt and the weighted average cost of capital (WACC) for the company. Express the WACC as a percentage to two decimal places.
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About This Question
This is Gce Model Questions Vol1 2017 Commerce Question 45. It is one of the objective questions from the 2017 Gce Model Questions Vol1 Commerce examination.
Difficulty level: Medium .
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