Question

Weighted average Cost of capital for Lavi Ltd. is 12%. Lavi Ltd. has issued equity worth Rs. 45 lakhs, 5% debt worth Rs. 15 lakhs and 6% preference shares worth Rs. 10 lakhs. The manager of this company wants to know the cost of equity applicable to the firm. The tax rate is 10%.

A 11%
B 14%
C 16%
D 17%
E 20%
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