Question
SAS's outstanding 11% coupon rate debentures mature in 15 years, pay interest semiannually and are callable at $1,015 in 3 years. The bonds are selling
SAS's outstanding 11% coupon rate debentures mature in 15 years, pay interest semiannually and are callable at $1,015 in 3 years. The bonds are selling at $998. SAS has a beta of 1.5, the risk free rate is 3% and the expected return on the market is 12%. SAS optimal capital structure is thought be 55% debt and 45% common equity. Tax rate is 35% Calculate SAS's WACC.
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The Social Media Handbook For Financial Advisors
Authors: Matthew Halloran
1st Edition
1118208013, 978-1118208014
