Question
LBD has a single American bond issue with a 6.5% coupon, nine years to maturity, trading at $1245 per $1000 face, with a face value
LBD has a single American bond issue with a 6.5% coupon, nine years to maturity, trading at $1245 per $1000 face, with a face value of $600,000. Its cost of equity is 11%. The firm has 120,000 shares of common outstanding trading at $30 per share. It has 50,000 shares of preferred outstanding, trading at $40 per share with a $5 dividend. LBD's tax= 30%. What is LBD's WACC?
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Investments
Authors: Zvi Bodie
12th Edition
1260819426, 9781260819427
