3. CALCULATING WACC You are given the following information concerning Wayne- Martin Electric (WME): Debt: 8,000 6.5 percent coupon bonds outstanding, with 25 years to maturity, and a quoted price of 106 (106% of face value). These bonds pay interest semiannually. Common stock: 310,000 shares of common stock selling for $57 per share. The stock has a beta of 1.35. WME has a current outstanding dividend of $4.25 and will pay a dividend of $4.50 next year. The dividend is expected to grow by 5 percent per year indefinitely. Preferred stock: 15,000 shares of 4 percent of $100 par preferred stock, selling at $72 per share. Market: a 7 percent market risk premium, a 4.5 percent risk-free rate, and a 40 percent tax rate. Calculate the WACC for WME.