QUESTION 41

The current stock price for a company is $47 per share, and there are 8 million shares outstanding. The beta for this firms stock is 0.9, the risk-free rate is 4.2, and the expected market risk premium is 6%. This firm also has 120,000 bonds outstanding, which pay interest semiannually. These bonds have a coupon interest rate of 9%, 18 years to maturity, a face value of $1,000, and an annual yield to maturity of 8.4%. If the corporate tax rate is 35%, what is the Weighted Average Cost of Capital (WACC) for this firm? (Answer to the nearest hundredth of a percent, but do not use a percent sign).