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5. The total book value of WTCs equity is $100 million and book value per share outstanding is $20. The stock of WTC is currently
5. The total book value of WTCs equity is $100 million and book value per share outstanding is $20. The stock of WTC is currently selling for a price of $45 per share and the beta of WTC is 1.15. The bonds of WTC have a face value of $80 million and sell at a price of 110 percent of face value. The yield to maturity on the bonds is 5.5 percent and the firms tax rate is 35 percent. If the E(Rm) = 8% and Rf = 1%, calculate the WACC of WTC.
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