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Micro Spinoffs, Inc., issued 20-year debt a year ago at par value with a coupon rate of 8%, paid annually. Today, the debt is selling
Micro Spinoffs, Inc., issued 20-year debt a year ago at par value with a coupon rate of 8%, paid annually. Today, the debt is selling at $1,100. The firms tax bracket is 20%. |
Micro Spinoffs also has preferred stock outstanding. The stock pays a dividend of $4 per share, and the stock sells for $20. |
Micro Spinoffss cost of equity is 22%. What is its WACC if equity is 50%, preferred stock is 20%, and debt is 30% of total capital? (Do not round intermediate calculations. Round your answer to 2 decimal places.) |
WACC | % |
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