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5. A firm has 2,000,000 shares of common stock outstanding with a market price of $2 per share. It has 2,000 bonds outstanding, each selling

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5. A firm has 2,000,000 shares of common stock outstanding with a market price of $2 per share. It has 2,000 bonds outstanding, each selling for $1,200. The bonds mature in 15 years have a coupon rate of 10% and pay coupons annually! The firm's beta is 1.2, the risk free rate is 5%, and the market risk premium is 7%. The tax rate is 21%. Using the market values of debt and equity calculate the WACC

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