Majuri has 850,000 shares of common stock outstanding at a market price of $16 a share. The company also has 15,000, $1,000 par bonds outstanding that are quoted at 98 % of face value. What weight should be given to the debt when Majuri computes their weighted average cost of capital?
a. 52.1%
b. 49.2%
c. 51.9%
d. 50%
e. 48.1%