Gaucho Services starts life with all-equity financing and a cost of equity of 13%. Suppose it refinances to the following market-value capital structure:

14 Gaucho Services starts life with all-equity financing and a cost of equity of 13%. Suppose it refinances to the following market value capital structure: Debt (D) Equity (E) 48% 52% at ro = 9.1% Skipped Use MM's proposition 2 to calculate the new cost of equity. Gaucho pays taxes at a marginal rate of Tc = 34%. Calculate Gaucho's after-tax weighted average cost of capital. (Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.) After-tax WACC