Question 27.

PinderLtd operates under the classical tax system. The market value of Pinder Ltds debt and equity are $2,000,000 and $3,000,000, respectively. The before-tax cost of borrowing for Pinder Ltd is 8% and the cost of equity is 15%. If Pinder Ltds tax rate is 30%, what is Pinder Ltds weighted average cost of capital?(Show all your work.)