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CAPCO HAS A CAPITAL STRUCTURE THAT IS COMPOSED OF $20 MILLION OF DEBT AND $80 MILLION OF COMMON EQUITY . IF CAPCO IS IN 3%%

CAPCO HAS A CAPITAL STRUCTURE THAT IS COMPOSED OF $20 MILLION OF DEBT AND $80 MILLION OF COMMON EQUITY . IF CAPCO IS IN 3%% MARGINAL TAX RATE, WHAT IS ITS WACC IF THE YIELD TO INVESTORS ON CAPCO DEBT IS 8% AND THE CST OF CAPCO COMMON EQUITY IS 10% A) 8.63 B) 9.75 C 9.04 D) 8.35?

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