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Kestrel, Inc. has an equity market capitalization of $ 6 , 5 0 0 , 0 0 0 . Its equity beta is 2 .

Kestrel, Inc. has an equity market capitalization of $6,500,000. Its equity beta is 2.4. The risk-free rate and market return are expected to be 1.4% and 7.2%, respectively. Kestrel also has $2,700,000 in bonds that have a yield-to-maturity of 4.8%. If Kestrel faces a tax rate of 18%, what is the weighted average cost of capital for Kestrel?

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