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What is the companys weighted average cost of capital if

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MS Energy has a target capital structure of 30% debt, 10% preferred stock, and 60% common equity. The company's after-tax cost of debt is 5%, its cost of preferred stock is 8%, and its cost of retained earnings is 12%. What is the company's weighted average cost of capital if retained earnings are used to fund the common equity portion?

 

A. 8.0%

 

B. 9.50%

 

C. 10.20%

 

D. 12.80%.

Reference no: EM13479178

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