The cost of preferred is 750 and the cost of retained

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You were hired as a consultant to Giambono Company, whose target capital structure is 40% debt, 15% preferred, and 45% common equity. The after-tax cost of debt is 6.00%, the cost of preferred is 7.50%, and the cost of retained earnings is 13.00%. The firm will not be issuing any new stock. What is its WACC?

a.

9.38%

b.

11.44%

c.

9.19%

d.

7.22%

e.

10.22%

Reference no: EM13479150

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