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our firm has 100 shares of stock outstanding, which have a current market price of $1,000 per share. Your debt has a face value of

our firm has 100 shares of stock outstanding, which have a current market price of $1,000 per share. Your debt has a face value of $124,000 and a market value of $150,000. Your debt beta is 0.5 and the equity returns have a standard deviation of 50% and a correlation with market returns of 0.4. Under the MM theorem, what is the WACC if the risk free rate is 7% and the expected market returns is 10% with a standard deviation of 10%?

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