Question
Bartlett Company's target capital structure is 40% debt, 15% preferred, and 45% common equity. The after-tax cost of debt is 7.00%, the cost of preferred
Bartlett Company's target capital structure is 40% debt, 15% preferred, and 45% common equity. The after-tax cost of debt is 7.00%, the cost of preferred is 7.50%, and the cost of common equity is 12.75%. The firm will not be issuing any new stock. You were hired as a consultant to help determine their cost of capital. What is its WACC?
| 8.98% | ||
| 9.26% | ||
| 9.54% | ||
| 9.66% | ||
| None of the above. |
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Introduction To Finance
Authors: Lawrence J Gitman, Jeff Madura
1st Edition
0201635372, 9780201635379
