Question: The Jamestown Co. has a capital structure which is based on 40% debt, 15% preference shares, and 45% ordinary shares. The flotation costs are 8%

The Jamestown Co. has a capital structure which is based on 40% debt, 15% preference shares, and 45% ordinary shares. The flotation costs are 8% for ordinary shares, 9% for preference shares, and 4% for debt. What is the weighted average flotation cost?

Select one:

a. 6.55%

b. 7.00%

c. 7.19%

d. 6.87%

e. 6.68%

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