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Assume that you are on the financial staff of LaSalle Inc., and you have collected the following data: The yield on the company's outstanding bonds
Assume that you are on the financial staff of LaSalle Inc., and you have collected the following data: The yield on the company's outstanding bonds is 8.00%, and its tax rate is 40%. . The next expected dividend is $0.65 a share, and the dividend is expected to grow at a constant rate of 6.00% a year. The price of LaSalle's stock is $17.50 per share, and the flotation cost for selling new shares is 10%. The target capital structure is 45% debt, and the balance is common equity. What is your estimate to LaSalle's WACC, assuming it must issue new stock to finance its capital budget?
Assume that you are on the financial staff of LaSalle Inc., and you have collected the
following data:
The yield on the company's outstanding bonds is 8.00%, and its tax rate is 40%.
. The next expected dividend is $0.65 a share, and the dividend is expected to grow at a
constant rate of 6.00% a year.
The price of LaSalle's stock is $17.50 per share, and the flotation cost for selling new
shares is 10%.
The target capital structure is 45% debt, and the balance is common equity.
What is your estimate to LaSalle's WACC, assuming it must issue new stock to
finance its capital budget?
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