Question: Springfield Corporation, whose tax rate is 34%, has two sources of funds: long-term debt with a market value of $6,000,000 and an interest rate of

Springfield Corporation, whose tax rate is 34%, has two sources of funds: long-term debt with a market value of $6,000,000 and an interest rate of 9%, and equity capital with a market value of $16,000,000 and a cost of equity of 14%. What is Springfield's weighted average cost of capital (WACC)?

A)14.00%

B)9.97%

C)11.80%

D)12.64%

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