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Assume Ford Motor Company is discussing new ways to recapitalize the firm and raise additional capital. Its current capital structure has a 10% weight in

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Assume Ford Motor Company is discussing new ways to recapitalize the firm and raise additional capital. Its current capital structure has a 10% weight in equity, 25% in preferred stock, and 65% in debt. The cost of equity capital is 15%, the cost of preferred stock is 9%, and the pretax cost of debt is 7%. What is the weighted average cost of capital for Ford if its marginal tax rate is 25% ? A. 7.56% B. 7.2% C. 7.92% D. 6.84%

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