Problem regarding weighted average cost of capital


Problem:

Given the following data, compute the WACC

Cost (after tax)         Weights    Weighted Cost
Debt (Kd)                   7.70%    30%
Preferred stock (Kp)    10.81     15
Common equity (Ke)    13.00    55
(retained earnings)

Weighted average cost of capital (Ka)?

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Finance Basics: Problem regarding weighted average cost of capital
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