The XYZ Company is planning a $50 million expansion. Theexpansion is to be finan

The XYZ Company is planning a $50 million expansion. Theexpansion is to be financed by selling $20 million in new debt and$30 million in new common stock. The before-tax required rate ofreturn on debt is 9% and the required rate of return on equity is14%. If the company is in the 40% tax bracket what is the marginalcost of capital?