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Given the following information for Company A, find the WACC. Assume the company's tax rate is 35 percent. Debt: 15,000, 6.0 percent coupon bonds outstanding,
Given the following information for Company A, find the WACC. Assume the company's tax rate is 35 percent. Debt: 15,000, 6.0 percent coupon bonds outstanding, $1,000 par value, 20 years to maturity, selling for 98 percent of par; the bonds make semiannual coupon payments. Common stock: 200,000 shares outstanding, selling for $50 per share; the beta is 1.40. Market: 7 percent market risk premium and 3.0 percent risk-free rate.
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