Question

Given the following information: Percent of capital structure: Debt 40 % Preferred stock 20% Common equity...

Given the following information:

Percent of capital structure:

Debt 40 %

Preferred stock 20%

Common equity 40 %

Additional information:

Bond coupon rate 8%

Bond yield to maturity 6%

Dividend, expected common $ 4.00

Dividend, preferred $ 11.00 Price,

common $ 55.00 Price,

preferred $ 134.00

Flotation cost, preferred $ 8.20

Growth rate 9%

Corporate tax rate 30%

Calculate the Hamilton Corp.'s weighted cost of each source of capital and the weighted average cost of capital

Debt-

Preferred Stock-

Common equity-

Weighted Average cost of Captial-

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