Each source of capital and weighted average cost of capital

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Reference no: EM131983112

Global Technology’s capital structure is as follows: Debt 15 % Preferred stock 50 Common equity 35 The aftertax cost of debt is 6.00 percent; the cost of preferred stock is 10.00 percent; and the cost of common equity (in the form of retained earnings) is 13.00 percent.

Calculate the Global Technology’s weighted cost of each source of capital and the weighted average cost of capital. (Do not round intermediate calculations. Input your answers as a percent rounded to 2 decimal places.)

a. Weighted cost of debt =

b. Weighted cost of preferred stock =

c. Weighted cost of common equity =

Reference no: EM131983112

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