000,1212 Brashear Hydrology, Inc. has determined that its optimal capital structure consists of 74% equity and...

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000,1212 Brashear Hydrology, Inc. has determined that its optimal capital structure consists of 74% equity and 26% debt. The company must raise additional capital to fund its upcoming expansion and its tax rate is 25%. The firm has $0.5 million in retained earnings that has a cost of 9%. Its investment bankers have informed the company that it can issue an additional $4 million of new common equity at a cost of 11.5%. Furthermore, the firm can raise up to $1.0 million of debt at 6% and an additional $3 million at 7.5%. The firm has estimated that the proposed expansion will require an investment of $4.2 million. What is the average after-tax cost of capital for the entire $4.2 million that the company will be raising? a. 9.41 percent b. 11.20 percent c. 9.81 percent d. 5.52 percent e. 7.83 percent (85 305520 oluberle DOM ori ai cODAW steluain noso Insors 21.0 000,1212 Brashear Hydrology, Inc. has determined that its optimal capital structure consists of 74% equity and 26% debt. The company must raise additional capital to fund its upcoming expansion and its tax rate is 25%. The firm has $0.5 million in retained earnings that has a cost of 9%. Its investment bankers have informed the company that it can issue an additional $4 million of new common equity at a cost of 11.5%. Furthermore, the firm can raise up to $1.0 million of debt at 6% and an additional $3 million at 7.5%. The firm has estimated that the proposed expansion will require an investment of $4.2 million. What is the average after-tax cost of capital for the entire $4.2 million that the company will be raising? a. 9.41 percent b. 11.20 percent c. 9.81 percent d. 5.52 percent e. 7.83 percent (85 305520 oluberle DOM ori ai cODAW steluain noso Insors 21.0