WACCMarket value weights The market values and after-tax costs of various sources of capital used by Ridge Tool are shown in the following table: : . a. Calculate the firm's weighted average cost of capital. b. Explain how the firm can use this cost in the investment decision-making process. 1 Data Table (Click on the icon located on the top-right corner of the data table below in order to copy its contents into a spreadsheet.) Source of capital Long-term debt Preferred stock Common stock equity Market value $900,000 $90,000 $400,000 Individual cost 5.1% 10.2% 14.8% Print Done