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A firm is 30% debt and 70% equity.The firm's tax rate is 40%.Their bonds trade for $990,mature in five years,and have a coupon rate of
A firm is 30% debt and 70% equity.The firm's tax rate is 40%.Their bonds trade for $990,mature in five years,and have a coupon rate of 8% paid annually.The firm's common stock trades at $15 per share and just paid a dividend of $3per share.The dividends are expected to grow at a rate of 3% per year forever.
The bond's yield is____ %
The required rate of return for the company's common stock is____%.
The cost of financing for this firm (WACC) is_____%.
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