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Given the following information for Eerie Company, find its WACC. Assume the company s tax rate is 25 percent. Debt: 22,000, 6.0 percent coupon bonds
Given the following information for Eerie Company, find its WACC. Assume the company s tax rate is 25 percent. Debt: 22,000, 6.0 percent coupon bonds outstanding, $1,000 par value, 12 years to maturity, selling for 102 percent of par; the bonds make semiannual coupon payments. Common stock: 300,000 shares outstanding, selling for $40 per share; the beta is 1.50. Market: 7.2 percent market risk premium and 4.0 percent risk-free rate. 7.97% 7.63% 7.35% 7.02% 6.71%
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