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Jon Stark ,Inc. Has estimated the costs of debt and equity capital for various proportions of debt in its capital structure. % of Debt Cost
Jon Stark ,Inc. Has estimated the costs of debt and equity capital for various proportions of debt in its capital structure.
% of Debt | Cost of Debt | Cost of Equity |
0% | - | 13.0% |
10% | 5.4% | 13.3 |
20% | 5.6 | 13.8 |
30% | 5.8 | 14.4 |
40% | 6.3 | 15.2 |
50% | 7.0 | 16.0 |
60% | 8.2 | 17.0 |
Based on these estimates, determine the WACC of Jon Starks optimal capital structure. Answers should be rounded off to 4 decimal places.
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