Preferred Stock and WACC The Saunders Investment Bank has the following financing outstanding.

What is the WACC for the company?

Debt: $,60,000$ bonds with a coupon rate of $6$ percent and a current price quote of

$109\mathrm{.}5$; the bonds have $20$ years to maturity. $230,000$ zero coupon bonds with a

price quote of $17\mathrm{.}5$ and $30$ years until maturity.

Preferred stock: $,150,000$ shares of $4$ percent preferred stock with a current price of $$79,$ and a

par value of $$100.$

Common stock: $,2,600,000$ shares of common stock; the current price is $$65,$ and the beta of

the stock is $1\mathrm{.}15.$

Market: The corporate tax rate is $40$ percent, the market risk premium is $7$ percent, and

the risk$-$free rate is $4$ percent.The Saunders Investment Bank has the following financing outstanding.

What is the WACC for the company?

Debt:

$60,000$ bonds with a coupon rate of $6$ percent and a current price quote of

$109\mathrm{.}5$; the bonds have $20$ years to maturity. $230,000$ zero coupon bonds with a

price quote of $17\mathrm{.}5$ and $30$ years until maturity.

Preferred stock:

Common stock:

$150,000$ shares of $4$ percent preferred stock with a current price of $$79,$ and a

par value of $$100.$

$2,600,000$ shares of common stock; the current price is $$65,$ and the beta of

the stock is $1\mathrm{.}15.$

$92$

a$90$

Market:

The corporate tax rate is $40$ percent, the market risk premium is $7$ percent, and

the risk$-$free rate is $4$ percent. $($ please do not use exel$)$