Hugh Smith, the finance director of Zuz Plc, is currently reviewing the company's capital structure. Hugh believes that the company is not financing itself in a way that minimises its weighted average cost of capital (WACC) to increase the company's wealth. The company now wants to calculate WACC using CAPM in the computation. Extract from the statement of financial position statement of Zuz Plc Equity finance Ordinary shares (50p nominal value) Reserves 400 300 Non-current liabilities 7% preference shares (1 nominal value) 600 9% bonds (redeemable after 8 years) 1,300 9% bank loan 1,120 Additional information 1. Yield on treasury bills is 2. Zuz Plc equity beta 7% 1.1 17% 3. Return on market 4. Current ex div ordinary share price 5. Current ex div preference share price 6. Current ex interest bond price 7. Corporation tax rate 2.35 66p 105 per 100 bond 30%