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Hydro Ltd.s capital structure is made up of debt, preference share and ordinary share capital. The book value of the debt, preference and ordinary share
Hydro Ltd.s capital structure is made up of debt, preference share and ordinary share capital. The book value of the debt, preference and ordinary share capital is held in portions of 30:20:50 respectively while the market value is held in portions 25:20:55 respectively. The cost of equity capital is 13.5%, the cost of preference share capital is 11%, and the after-tax cost of debt capital is 8%. Calculate Hydro Ltd.s weighted average cost of capital (rounded to two decimal places) 10.25% 11.35% 9.98% 11.63%
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