Question
A company has 10,000 bonds outstanding with 5.93% yield-to-maturity. The bond is selling for $1,080. There are 370,000 common shares outstanding which sells for $55
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A company has 10,000 bonds outstanding with 5.93% yield-to-maturity. The bond is selling for $1,080. There are 370,000 common shares outstanding which sells for $55 per share. The common stock has a beta of 1.11. The risk-free rate is 4.5% and the market risk premium is 6%. The company also issued 15,000 shares of preferred stock which currently sells for $75 per share. The preferred dividend is $5 per share. The companys tax rate is 38%. What is the companys WACC?
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1st Edition
1954968574, 978-1954968578
