What is firm weighted average cost of capital

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Question - A firm has the following data: Target capital structure of 20% debt, 10% preferred stock, and 70% common equity; Tax rate is 30%; cost of debt is 7%, cost of preferred stock is 7.5%, and cost of common equity is 11.5%. Assume the firm will not issue any new stock.

Required - What is firm's weighted average cost of capital (WACC)?

Reference no: EM132869270

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