Question: Builtrite's target capital structure is 50% common stock, 10% preferred stock and 40% debt. If the cost of common is 16%, the cost of preferred

Builtrite's target capital structure is 50% common stock, 10% preferred stock and 40% debt. If the cost of common is 16%, the cost of preferred stock is 12% and the before tax cost of debt is 6% (the tax rate is 34%), what is Builtrites weighted average cost of capital?

11.60%

10.78%

10.06%

9.85%

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