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Olden Company has a tax rate of 40 percent. Information for the company is as follows: Amount After-tax Cost Mortgage bonds $1,000,000 0.048 Unsecured bonds

Olden Company has a tax rate of 40 percent. Information for the company is as follows:

Amount After-tax Cost
Mortgage bonds $1,000,000 0.048
Unsecured bonds 3,000,000 0.050
Common stock 6,000,000 0.150

What is the weighted average cost of capital?

a.0.0366

b.0.0827

c.0.2480

d.0.1098

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