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Sunrise Manufacturing, Inc., a U.S. multinational company, has the following debt components in its consolidated capital section, Assumption Value Tax rate 39% 25-year US$ bonds

Sunrise Manufacturing, Inc., a U.S. multinational company, has the following debt components in its consolidated capital section,

Assumption

Value

Tax rate

39%

25-year US$ bonds

$20,000,000

5-year US$ bonds

$5,000,000

10-year eurobonds (euros)

9,000,000

20-year yen bonds (yen)

950,000,000

Pre-tax cost of 25-year US$ bonds

6.5%

Pre-tax cost of 5-year US$ bonds

4.5%

Pre-tax cost of 10-year eurobonds

6.0%

Pre-tax cost of 20-year yen bonds

3.0%

Spot rate

($/)

1.2500

Spot rate

($/)

1.8800

Spot rate

(/$)

109.00

. Sunrise's shareholders' equity is $45,000,000 and its finance staff estimates their cost of equity to be 17.5%. Current exchange rates are also listed in the table. Income taxes are 39% around the world after allowing for credits. Calculate Sunrise's weighted average cost of capital. Are any assumptions implicit in your calculation?

What is Sunrise's weighted average cost of capital?

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