Question: Sources of capital Weights Long-term debt 40% Preferred stock 15% Common equity 45% Total 100% Based on the information given,** calculate the weighted average cost

Sources of capital Weights Long-term debt 40% Preferred stock 15% Common equity 45% Total 100% Based on the information given,** calculate the weighted average cost of capital (WACC) if *the firm uses its retained earnings. *the firm issues common stock. Based on your findings in part (b), if the firm's tax rate is decreased to 30% and the floatation cost for preferred stock increases by 5%, calculate the new WACC *if the firm decided to use its internal equity. *if the firm decided to use its external equity

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