What is Brehm Beta weighted average cost of capital

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Brehm Beta, Inc. has 22,000 shares of common stock outstanding at a market price of $26 a share. This stock was originally issued at $19 per share. The firm also has a bond issue outstanding with a total face value of $350,000 which is selling for 97 percent of face value. The cost of equity is 11 percent while the aftertax cost of debt is 6 percent. The firm has a beta of 1.2 and a tax rate of 35 percent. What is Brehm Beta’s weighted average cost of capital?

Reference no: EM131919957

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