2. Calculating the WACC. Calculate the WACC for the following firm.

Debt: 3,000 bonds with a 6% coupon rate and a quoted price of 94.5. The bonds have 20 years to maturity.

Common stock: 130,000 shares of common stock. The dividends have a growth rate of 5%, the current price is $40, and the dividend next year will be $3.00. The beta of the stock is 0.9

Preferred stock: 10,000 shares of 6% preferred with a current price of $80.

Market: The corporate tax rate is 35%, the expected return on the market is 13%, and the risk-free rate is 7%.