What is the weighted cost of capital

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Consider the following: cost of debt before taxes is 8%, the cost of equity before taxes is 6% and the cost of preferred stock before taxes is 10%. The tax rate is 30%. The company's captial structure is comprised fo 40% debt, 30% equity and 30% preferred stock. What is the weighted cost of capital?

  • .07
  • .08
  • .06
  • .09

Reference no: EM131429127

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