The capital structure of Merritt Co. is 20% common equity and debt equal to 80%. The cost of common equity is 10% and the pretax cost of debt is 5%. Merritt's tax rate is 21%. What is Merritt's weighted-average cost of capital?
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Home » Business » The capital structure of Merritt Co. is 20% common equity and debt equal to 80%. The cost of common equity is 10% and the pretax cost of debt is 5%. Merritt's tax rate is 21%. What is Merritt's weighted-average cost of capital?