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Consider the following information for Evenflow Power Co., Debt: 2,000 8 percent coupon bonds outstanding, $1,000 par value, 19 years to maturity, selling for 105
Consider the following information for Evenflow Power Co., |
Debt: | 2,000 8 percent coupon bonds outstanding, $1,000 par value, 19 years to maturity, selling for 105 percent of par; the bonds make semiannual payments. | ||
Common stock: | 50,000 shares outstanding, selling for $57 per share; the beta is 1.06. | ||
Preferred stock: | 6,500 shares of 7 percent preferred stock outstanding, currently selling for $107 per share. | ||
Market: | 9.5 percent market risk premium and 6.5 percent risk-free rate. | ||
Assume the company's tax rate is 33 percent. |
Required: |
Find the WACC. (Do not round your intermediate calculations.) |
rev: 09_20_2012
Multiple Choice
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11.04%
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11.24%
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10.94%
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11.96%
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11.44%
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