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The Blossom Company has an after-tax cost of debt capital of 3 percent, a cost of preferred stock of 7 percent, a cost of equity

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The Blossom Company has an after-tax cost of debt capital of 3 percent, a cost of preferred stock of 7 percent, a cost of equity capital of 10 percent, and a weighted average cost of capital of 6 percent. Blossom intends to maintain its current capital structure as it raises additional capital. In making its capital-budgeting decisions for the average-risk project, the relevant cost of capital is: 3 percent. 6 percent. 7 percetit. 10 percent

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