Q22 1

	Target % in Capital Structure
Debt	35%
Preferred Stock	10%
Equity	55%
Tax Rate =	28%
Outstanding Bond		Preferred Stock Info		Common Stock Info
(Annual Coupons)		Preferred Divided	$3	Current Dividend	$2
Time to Maturity (years)	15	Current Market Price	$60	Current Price	$50
Coupon Rate APR	5.00%			Expected Growth in Dividends	2.88%
Face Value	$1,000
Current Market Price	$1,240

Using the information in the table, what is the firms cost of common stock?

State your answer as a percentage to two decimal place (e.g., 5.30)

2.

	Target % in Capital Structure
Debt	40%
Preferred Stock	10%
Equity	50%
Tax Rate =	21%
Outstanding Bond		Preferred Stock Info		Common Stock Info
(Annual Coupons)		Preferred Divided	$3	Current Dividend	$3.00
Time to Maturity (years)	15	Current Market Price	$67	Current Price	$50.00
Coupon Rate APR	5.00%	Preferred Yield		Expected Growth in Dividends	2.16%
Face Value	$1,000
Current Market Price	$1,240

Using the information in the table, what is the firms cost of preferred stock?

State your answer as a percentage to two decimal places (e.g., 5.30).

3.

	Target % in Capital Structure
Debt	40%
Preferred Stock	10%
Equity	50%
Tax Rate =	33%
Outstanding Bond		Preferred Stock Info		Common Stock Info
(Annual Coupons)		Preferred Divided	$3.00	Current Dividend	$3.00
Time to Maturity (years)	10	Current Market Price	$60.00	Current Price	$50.00
Coupon Rate APR	5.00%	Preferred Yield	5.00%	Expected Growth in Dividends	2.16%
Face Value	$1,000			Expected Return on Equity	8.29%
Current Market Price	$1,240
YTM	2.29%

Using the information in the table, what is the firms WACC?

State your answer as a percentage to two decimal places (e.g., 5.30)