Given the following information on Big Brothers, Inc. capital structure, compute the company’s weighted average cost of capital (WACC). The company’s marginal tax rate is 40%.
Round the answer to two decimal places in percentage form.
Type of Capital Percent of Captial Structure Before Tax Component Cost
Bonds 42% 12.62%
Preferred Stock 19% 17.35%
Common Stock please calculate it 16.75%