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Academic MBA Question:

Allied Industries has raised capital by way of Equity, Preference Shares and Debt at a cost of 18%, 12% and 10% respectively.

Capital (in Rs million) Book Value Market Value
Equity 500 1000
Preference 250 250
Debt 250 250

Calculate the weighted average cost of capital based on

a. Market Values (5 Marks)

b. Book Values. (5 Marks)


Academic Assignment Answer:

Single Question and Answer