The following information applies to a corporation:
The company has $200 million of equity and $100 million of debt.
The company recently issued bonds at 9%.
The corporate tax rate is 30%.
The company's beta is 1.125.
If the risk-free rate is 6% and the expected return on the market portfolio is 14%, the company’s after-tax weighted average cost of capital is closest to: A. 10.5%. B. 11.2%. C. 12.1%.
