Assuming CGT's cost of equity is 13 percent, the best estimate of the firm's WACC is closest to: 10.85% 11.19% 11.53% 11.88%

There are three consecutive problems that use the information below. Assume that you have been in a consultant by CGT a major producer of chemicals and plasties, including cery bas, syrofoam cups, and felters, to timate the firm wehed vee cout of capital. The balance sheet and some other information are provided below Assets Current assets $38.000000 Netpunt property, and equipment 101.000.000 $139,000,000 TOTOOOOO Total Labinties and Equity Accounts payable Aceruats Current abiliness Long-term debt (40.000 bonds, 51,000 para Totalboties 3.000.000 T8,000,000 40.000.000 550.000.000 20.000.000 56,000,000 80.000.000 Corrmon stock (16,000000 shares) Retained camin Toca shareholders equity Total liabilities and shareholders' equity 5139,000,000 Market value of CGTs stock - 515.25 per share CGT has $1,000 par value 20-year 7.25 coupon bonds with smal payments, selling for 1875.00 CGT stock beta 1.25 6-month Treasury bill yield-350 20-year Treasury bond yield -50% Required return on S&P 500 11 SOX The firm's tax rate is 40 Assuming CGT's cost of equity is 13 percent, the best estimate of the firm's WACC is closest to: 10.85% 11.1996 11.53% 11.88%