**
Fill This Form To Receive Instant Help**

Homework answers / question archive / This is what you know for calculating the weighted average cost of capital (WACC): Has a model capital structure of 65% stock (S) and 35% debt (B)

This is what you know for calculating the weighted average cost of capital (WACC):

- Has a model capital structure of 65% stock (S) and 35% debt (B).
- After-tax cost of debt is 6.78% (R
_{B}). - Cost of equity is 13.13% (R
_{S}).

Calculate the WACC using this formula:

WACC = [S ÷ (S + B)] × R_{S} + [B ÷ (S + B)] × R_{B}

Already member? Sign In