A company has the following capital structure, which it considers to be optimal The company's (tax rate is 34% and investors expec/ earnings and dividends to grow at a constant rate of 11% in future. The company paid a (dividend of Tk. 4.60 per share last year)and its stock currently sells at (Tk. 60 per)share. (Treasury bonds yield 11\%), an (average stock has a 14% expected rate of return and the company's(beta is 1.75 ) These terms would apply to new security offerings. New preferred stock can be sold to the public at a price of Tk. 100 per share with a dividend of Tk. 12 per share. Flotation cost of Tk. 5 per share will be incurred. This flotation cost is applicable to common share as well. Long term bonds can be sold at an YTM of 12% and interest rate on bank loan would be 12.50%. Debenture will pay interest at a rate of 15% compounded annually. Find the component costs and the WACC if the 40% of the equity is newly issued. Discuss the factors that affect the weighted average cost of capital of a company. A company has the following capital structure, which it considers to be optimal The company's (tax rate is 34% and investors expec/ earnings and dividends to grow at a constant rate of 11% in future. The company paid a (dividend of Tk. 4.60 per share last year)and its stock currently sells at (Tk. 60 per)share. (Treasury bonds yield 11\%), an (average stock has a 14% expected rate of return and the company's(beta is 1.75 ) These terms would apply to new security offerings. New preferred stock can be sold to the public at a price of Tk. 100 per share with a dividend of Tk. 12 per share. Flotation cost of Tk. 5 per share will be incurred. This flotation cost is applicable to common share as well. Long term bonds can be sold at an YTM of 12% and interest rate on bank loan would be 12.50%. Debenture will pay interest at a rate of 15% compounded annually. Find the component costs and the WACC if the 40% of the equity is newly issued. Discuss the factors that affect the weighted average cost of capital of a company