The company has the following amount of capital with corresponding specific cost of each type:

Type of capital BV MV

Equity capital l $(25000$ shares of Rs $10$ each$)2500004500000$

$13\%$ preference share $(500$ shares of Rs $100$

each$)5000045000$

Reserves and surplus $150000$

$14\%$ debentures $(1500$ Debentures of Rs $100$ each$)150000145000$

The expected dividend per share is Rs $1\mathrm{.}40$ and the dividend per share is expected to grow at a rate of $8\%$ forever. Preference shares are redeemable after $5$ years at par, whereas debentures are redeemable after $6$ years at par. The tax rate for the company is $50\%.$

You are required to compute weighted average cost of capital using market Value as weight.