(1)Ordinary shares: The company has in issue 12 million ordinary shares. The current market value of each ordinary share is $4.0.

The company pays ordinary dividends annually and has just paid an ordinary dividend of $0.25 per share for the current year. Dividends are expected to grow at a constant rate of 4% per year in the future. The equity beta of Synergy is 1.20.

(2)Preference shares: 30 million 9% irredeemable preference shares in issue with a par value of $1. The current share price of each preference share is $1. The preference share dividends are paid annually and the dividends for the current year have just been paid.

(3)Bonds: The company has in issue 200,000 bonds which will mature in 8years' time. Eachbond has a face value of $100. The coupon rate of the bonds is 8% per year paid annually. Bond interest payments have just been made by the company. The market value of the bonds is not readily available. In the latest balance sheet of the company, the total book value of the bonds was $18m.

The risk-free rate is 2.5%, the expected return on the market is 10%

Profit tax is 20%.

What is the WACC of the company!