Question: Evans Technology has the following capital structure. Debt 40 % Common equity 60 The aftertax cost of debt is 6 percent; and the cost of

Evans Technology has the following capital structure.

Debt

40

%

Common equity

60

The aftertax cost of debt is 6 percent; and the cost of common equity (in the form of retained earnings) is 13 percent.

a.

What is the firms weighted average cost of capital? (Do not round intermediate calculations. Input your answers as a percent rounded to 2 decimal places.)

Weighted Cost

Debt (Kd)

%

Common equity (Ke)

Weighted average cost of capital (Ka)

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