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The current stock price for a company is $44 per share, and there are 8 million shares outstanding. The beta for this firms stock is
The current stock price for a company is $44 per share, and there are 8 million shares outstanding. The beta for this firms stock is 1.2, the risk-free rate is 4.8, and the expected market risk premium is 6.1%. This firm also has 100,000 bonds outstanding, which pay interest semiannually. These bonds have a coupon interest rate of 8%, 27 years to maturity, a face value of $1,000, and an annual yield to maturity of 7.8%. If the corporate tax rate is 37%, what is the Weighted Average Cost of Capital (WACC) for this firm?
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