Rumolt Motors has

67

million shares outstanding with a share price of

$26

per share. In addition, Rumolt has issued bonds with a total current market value of

$2,514

million. Suppose Rumolt's equity cost of capital is

15%,

and its debt cost of capital is

9%.

a. What is Rumolt's pre-tax WACC?

b. If Rumolt's corporate tax rate is

40%,

what is its after-tax WACC?

a. What is Rumolt's pre-tax WACC?

Rumolt's pre-tax WACC is

nothing%.

(Round to two decimal places.)