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Weighted cost of capital-bluegrass mint company

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Bluegrass Mint Company has a debt-equity ratio of 0.36. The required return on the company's unlevered equity is 15.6% and the pretax cost of the firm's debt is 5.2%. Sales revenue for the company is expected to remain stable indefinitely at last year's level of $20,382,047.2. Variable costs amount to 57% of sales. The tax rate is 23% and the company distributes all its earnings as dividends at the end of each year.

What is the Weighted Cost of Capital?

HINT: You will need the return of Levered Equity. Follow the process that you used to determine the answer to the previous problem

Reference no: EM133060037

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