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Suppose a firm has 25 million shares of common stock outstanding at a price of $34 per share. The firm also has 200,000 bonds outstanding
Suppose a firm has 25 million shares of common stock outstanding at a price of $34 per share. The firm also has 200,000 bonds outstanding with a current price of $1154.7. The outstanding bonds have yield to maturity 4.8%. The firm's common stock beta is 1.3 and the corporate tax rate is 35%. The expected market return is 12% and the T-bill rate is 3%. What is the WACC for this firm?
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