QUESTION 1 a) The capital structure for the GEN-Z Berhad is provided here: Capital structure RM’000 Bond 4,000 Preferred Stock 3,000 Common Stock 13,000 The firm is in a 25% tax bracket and plans to...

QUESTION 1

a) The capital structure for the GEN-Z Berhad is provided here:

The firm is in a 25% tax bracket and plans to maintain its capital structure in the future. If the firm has a 7% before-tax cost debt, a 12% cost of preferred stock, and a 16% cost of common stock, what is the firm’s weighted average cost of capital (WACC)?

b) Are preferred stocks a smart investment choice compared to common stocks? Whyor why not?

Note: question a,b clear ans no
not step1 step 2,3 like that !!