Sauer Milk Inc. wants to determine the minimum cost of capital point for the firm....
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Sauer Milk Inc. wants to determine the minimum cost of capital point for the firm. Assume it is considering the following financial plans: (aftortax) Weig Plan A 20% 7.0% 14.0 18.0 Preferred stock Common equity Plan 8 7.5% 14.5 19.0 30% 10 Preferred stock Common equity Plan C Preferred stock Common equity Plan D 80% 14.7 10.8 40% 10 Preferred stock Common equity 10.0% 15.2 12.5 50% 10 a-1. Compute the weighted average cost for four plans. (Do not round Intermediate calculations. Input your answers as a percent rounded to 2 decimal places. Weighted Cost Plan A Plan B Plan C Plan D a-2. Which of the four plans has the lowest weighted average cost of capitai? Plan A Plan B Plan C Plan D
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