Question: Builtrite's target capital structure is 55% common stock, 15% preferred stock and 30% debt. If the cost of common is 17%, the cost of preferred

Builtrite's target capital structure is 55% common stock, 15% preferred stock and 30% debt. If the cost of common is 17%, the cost of preferred stock is 13% and the before tax cost of debt is 8%. What is Builtrite's weighted average cost of capital assuming a marginal tax rate of 34%?

A. 11.38%

B. 12.88%

C. 12.25%

D. 13.70%

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