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please help friends Consider the case of Kuhn Co. Kuhin Co, is considering a new project that will require an initial imvestment of $4 million.
please help friends
Consider the case of Kuhn Co. Kuhin Co, is considering a new project that will require an initial imvestment of $4 million. It has a target capital structure of 45% debt, 4% preferred stock, and 51% common equty. Kuhn has noncallable bonds outstanding that mature in 15 years with a face value of $1,000, an annual coupon rate of 11%, and a market price of $1555.38. The yeld on the company's current bonds is a good approximation of the yield on any now bonds that it: issues. The compary can sell shares of preferred stock that pay an annual dividend of so at a price of $92.25 per share. Kuhn does not hove any retained earnings avaliable to finance this project, so the firm will have to issue new common stock to help fund it. Its commen stock is currently selling for $33.25 per share. and it is expected to pay a dividend of 52.78 at the end of neid vear. Flotation costs will represent eff of the funds raised by issuing new common stock. The company is projected to orow at a constant rate of 9.2%, and they face a tax mate of 40%. What will be the wacc for this project? (Noter found your intermediate calculations to two decimal places Step by Step Solution
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