ABC Corporation has a target capital structure of 60 percent common stock, 5 percent preferred...
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Finance
ABC Corporation has a target capital structure of 60 percent common stock, 5 percent preferred stock, and 35 percent debt. Its cost of common stock is 10 percent, the cost of preferred stock is 5 percent, and the pretax cost of debt is 7 percent. The relevant tax rate is 30 percent, what is the WACC?
a. 8.700%
b. 6.312%
c. 7.965%
d. 5.246%
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