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Alja [10]
3 years ago
6

Assume Ford Motor Company is discussing new ways to recapitalize the firm and raise additional capital. Its current capital stru

cture has a 25% weight in equity, 10% in preferred stock, and 65% in debt. The cost of equity capital is 13%, the cost of preferred stock is 9%, and the pretax cost of debt is 8%. What is the weighted average cost of capital for Ford if its marginal tax rate is 40%?
A) 8.36 %
B) 8.00 %
C) 6.91%
D) 7.27%
Business
1 answer:
AlladinOne [14]3 years ago
5 0

Answer:

The correct answer is

D) 7.27%

good luck ❤

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