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Company A wants to calculate its WACC. It has just issued a 14-year, 6% coupon, non-callable bond at par value. A's current stock price
Company A wants to calculate its WACC. It has just issued a 14-year, 6% coupon, non-callable bond at par value. A's current stock price is $32 and A just paid s $2.8 per share dividend. A's dividend payment is expected to grow at a constant rate of 2% a year. A wants to keep a debt-to-capital ratio of 70%. Tax rate is 35%. If A does not have preferred stock and floatation costs, what is its WACC (please report WACC as a decimal number with four decimal places, such as 0.0562)?
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