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A company has the following information. Debt: 22,000 bonds outstanding, 6 percent coupon, $1,000 par value, 10 years to maturity, selling for 102 percent of
A company has the following information. Debt: 22,000 bonds outstanding, 6 percent coupon, $1,000 par value, 10 years to maturity, selling for 102 percent of par; the bonds make semiannual coupon payments. Common stock: 280,000 shares outstanding, selling for $55 per share; the beta is 2.10. The company's tax rate is 25 percent. The market risk premium (MRP) is 7.0 percent and the risk-free rate is 3.0 percent. Find the company's weighted average cost of capital (WACC). 10.14% 9.75% 9.43% 9.08% 8.72% A company has net income of $410,000. The firm pays out 35 percent of the net income to its shareholders as dividends. During the year, the company sold $42,000 worth of common stock. What is the cash flow to stockholders? $83,500 $93,500 $124,500 $112,500 $101,500
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