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Beta Market leverage Progressive Insurance Group ( PGR ) 1 . 5 5 0 % Aetna, Inc. ( AET ) 1 . 4 6 0

Beta Market leverage
Progressive Insurance Group (PGR)1.550%
Aetna, Inc. (AET)1.460%
All state (ALL)0.845%
Spread between S&P 500 Composite Returns and Long-Term U.S. Government Bond Returns is 12%.
U.S. Government Interest Rates on 30-year bond is 5%.
UNR inc.s Insurance divisions Debt Rate Premium above Government is 3%.
Tax rate is 35%.
Assume that target capital structure of the insurance division is 30% debt and 70% equity. What is the WACC of the division, under target capital structure?

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