The common stock of Buildwell Conservation & Construction, Inc., has a beta of .95. The Treasury bill rate is 6%, and the market risk premium is estimated at 10%. BCCI’s capital structure is 35% debt, paying a 7% interest rate, and 65% equity. Buildwell pays tax at 30%.
a. What is BCCI’s cost of equity capital? (Round your answer to 2 decimal places.)
Cost of equity capital _____ %
b. What is BCCI’s WACC? (Round your answer to 2 decimal places.)
WACC _______%