Determine the weighted average cost of capital for a firm


Problem: What is the weighted average cost of capital for a firm in the 35% corporate tax bracket, with the following:

Financing Amount Rate of Interest for each.

Equity $ 1,150,000 11.57%

Debt $ 780,000 6.40%

Preferred $ 325,000 9.35%

Please show all work.

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Finance Basics: Determine the weighted average cost of capital for a firm
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