ps31 4

Caspian Sea Drinks' is financed with 62.00% equity and the remainder in debt. They have 10.00-year, semi-annual pay, 5.68% coupon bonds which sell for 98.98% of par. Their stock currently has a market value of $25.59 and Mr. Bensen believes the market estimates that dividends will grow at 3.52% forever. Next years dividend is projected to be $2.46. Assuming a marginal tax rate of 26.00%, what is their WACC (weighted average cost of capital)?