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Q1) Tawes & Co. has 100,000 semiannual coupon bonds outstanding, each with a par value of $1,000, coupon rate of 8%, and maturity of 15

Q1) Tawes & Co. has 100,000 semiannual coupon bonds outstanding, each with a par value of $1,000, coupon rate of 8%, and maturity of 15 years. Each bond sells at 110% of par. Tawes & Co. also has 1,000,000 shares of common stock outstanding that sell for $140 per share and have a beta of 1.7. The risk-free rate is 3%, market risk premium is 7%, and the corporate tax rate is 30%. What is Tawes & Co.'s weighted average cost of capital (WACC)?

A) 7.78%

B) 11.04%

C) 9.94%

D) 11.86%

E) 10.47%

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