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Calculating Capital Structure Weights A firm has the following target capital structure with $12,422 of debt, $5,108 of preferred stock and $12,130 of equity. The
Calculating Capital Structure Weights
A firm has the following target capital structure with $12,422 of debt, $5,108 of preferred stock and $12,130 of equity. The after-tax cost of debt is 5.35%, the cost of preferred stock is 10.41% and the cost of common equity is 13.17%. The firm faces a tax rate of 40%. What will be the firms weight on equity capital?
(your answer should be in percentages so 10% would be entered as 10 or 10%)
hint: you need to first find the total amound of invested capital
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