# Weighted Average Cost Of Capital (WACC)

Target capital structure 40% debt, 10% preferred, 50% common equity, interest rate on new debt 7.5%, yield on preferred is 7.0%, cost of retained earning is 11.50%, tax rate is 40%, no new stock. What is the WACC?

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#### Solution Summary

The solution provides the formula and detailed step-by-step calculation of the given problem.

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