QUESTION 4

The following information is provided in respect of the specific cost of capital of different sources along with the book value weights.

Source	Cost of capital	Book Values
Equity Share Capital	18%	0.5
Preference shares	15%	0.2
Long term debts	7%	0.3

How much is the Weighted Average Cost of Capital, WACC, using the BV weights.

		9.98%
		9.10%
		10.31%
		11.18%