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Currently, Forever Flowers Inc. has a capital structure consisting of 35% debt and 65% equity. Forever's debt currently has a 9% yield to maturity. The
Currently, Forever Flowers Inc. has a capital structure consisting of 35% debt and 65% equity. Forever's debt currently has a 9% yield to maturity. The risk-free rate (TRF) is 3%, and the market risk premium (rM - FRF) is 6%. Using the CAPM, Forever estimates that its cost of equity is currently 14%. The company has a 25% tax rate. a. What is Forever's current WACC? Round your answer to two decimal places.
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