Debt-equity ratio-weighted average cost of capital

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Reference no: EM131022487

The Felix Filter Corp. maintains a debt-equity ratio of .6. The cost of equity for Richardson Corp. is 16%, the cost of debt is 11% and the marginal tax rate is 30%. What is the weighted average cost of capital?

A. 8.38%

B. 11.02%

C. 12.89%

D. 14.12%

Reference no: EM131022487

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