Calculate the WACC which represents the "hurdle rate" for a typical project with average risk using the average of the range of the marginal cost of common equity using retained earnings or new earnings. Data: A 15-year, 12% coupon, semiannual payment non-callable bonds sell for $1,153.72. New bonds will be privately placed with no flotation cost.. A 10%, $1,000 par value, annually dividend, perpetual preferred stock sells for $1,111. Both an existing common stock and a new common stock issue, which incurs a flotation cost of 15% of the proceeds, sells for $50. D. - $4.3995 and g = 5%. b - 1.2: r. -7%; RP - 6%. Bond-Yield Risk Premium = 4% Target capital structure: 20% debt, 20% preferred, 60% common equity. Tax rate is 35%