Question

XYZ Corporation is financed by 30% equity and 70% by debt. The company has an after-tax cost of debt of 9% and the beta of shares in XYZ is 2. The risk-free rate of return is 3% and the equity risk premium is 8%. What is the after-tax weighted average cost of capital of XYZ company?

A 9%
B 10.2%
C 11.5%
D 11.63%
E 12%
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