Formulating the weighted average cost of capital

Reference no: EM131945833

Question: The Black Bird Company plans an expansion. The expansion is to be financed by selling $82 million in new debt and $146 million in new common stock. The before-tax required rate of return on debt is 9.52% percent and the required rate of return on equity is 16.05% percent. If the company is in the 34 percent tax bracket, what is the weighted average cost of capital?

Round the answer to two decimal places in percentage form

Reference no: EM131945833

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