Homework answers / question archive / Company A is financed by 28% of debt and the rest of the company is financed by common equity

Company A is financed by 28% of debt and the rest of the company is financed by common equity

Finance

Share With

Company A is financed by 28% of debt and the rest of the company is financed by common equity. The company's before-tax cost of debt is 4%, and its cost of equity is 14%. If the marginal tax rate is 30%, the company's weighted average cost of capital (WACC) is --. (Note: Write your answer as decimals with three decimal places. For example, if you answer is 8.7%, you should write 0.087 in the answer box. DO NOT write 8.7 in the box as you will be marked wrong)