Question $21$

Assume that the market value of $J$ Ho Company's total debt is $$775,000$ and its total equity is

$$225,000.$ The marginal corporate tax rate is $21\%.$ If the after$-$tax cost of debt is $5\mathrm{.}4\%$ and

the cost of equity is $8\mathrm{.}8\%,$ what is the cost of capital $($WACC$)$ for this company?

$6\mathrm{.}165\%$

$4\mathrm{.}185\%$

$5\mathrm{.}286\%$