Question: Please help me understand and solve it step by step Determine the weighted average cost of capital, given: Average expected borrowing rate = 12% Tax

Please help me understand and solve it step by step

Determine the weighted average cost of capital, given:

Average expected borrowing rate = 12%

Tax rate = 40%

Risk free rate = 3%

Risk premium of the market = 7%

Beta = 1.5

Market value of equity = $500

Book value of equity = $400

Market value of debt = $200

Book value of debt = $220

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