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The Tyler Oil Company's capitalstructure is as follows: Debt15%Preferred stock20Common equity65 The aftertax cost of debt is 12 percent; the cost of preferred stock is
The Tyler Oil Company's capitalstructure is as follows:
Debt15%Preferred stock20Common equity65
The aftertax cost of debt is 12 percent; the cost of preferred stock is 15 percent; and the cost of common equity (in the form of retained earnings) is 18 percent.
Calculate Tyler Oil Company's weighted average cost of capital in a manner similar toTable 11-1.(Round the final answers to 2 decimal places.)
Weighted CostDebt(Kd)%Preferred stock(Kp)Common equity(Ke)(retained earnings)Weighted average cost of capital(Ka)%
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