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Easy Car Corp. is a grocery store located in the Southwest. It paid an annual dividend of $2.00 last year to its shareholders and plans
Easy Car Corp. is a grocery store located in the Southwest. It paid an annual dividend of $2.00 last year to its shareholders and plans to increase the dividend annually at the rate of 5.0%. It currently has 1,000,000 common shares outstanding. The shares currently sell for $11 each. Easy Car Corp. also has 20,000 semiannual bonds outstanding with a coupon rate of 6.7773%, a maturity of 25 years, and a par value of $1,000. The bonds currently have a yield to maturity (YTM) of 6%, what is the adjusted WACC for Easy Car Corp. if the corporate tax rate is 20 %? Use 2 decimals in all your calculations (round to two decimals). MUST SHOW work in computing the steps to obtain the solution for this problem in order to receive credit. That is, you MUST document how you obtain the solution and the steps to get it. When computing the price of the bond in the problem, use either the formula approach or use the TVM tables and show the steps taken- excel calculations or financial calculator calculations or keys used will give you zero credit for this part
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