Question $1$

Calculate the WACC of a firm with the following data:

Common stock: $57$ million shares. Current price is $$62.$

The stock has a beta of $0\mathrm{.}95.$

Preferred stock: $3$ million shares. Current price is $$107.$

The stock pays an annual dividend of $$8$

Debt: $3$ million bonds. Current price is $$1011.$ The bonds

pay an annual coupon of $$60$ and have $18$ years to

maturity.

The risk free rate is $4\frac{\%}{?}$ year. The expected return on the

market portfolio is $10\%$ year.

The firm has a tax rate of $21\%.$

Express your answer as a percentage to two decimal

places: $7\mathrm{.}21$ percent would be $7\mathrm{.}21,$ for example.