Calculate the firm weighted average cost of capital

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Reference no: EM131070446

A firm’s capital structure is as follows: $10M of debt, $3M of preferred stock, and $12M of common stock. Debtholders require an 8% return, preferred stockholders require a 9% return, and common stockholders require an 11% return. The firm is in the 30% tax bracket. Calculate the firm’s weighted average cost of capital.

Reference no: EM131070446

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