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this is a two parter, cant answer 16 without 15 there is nothing else needed. What is the WACC for BearKat Autos (rounded to two

image text in transcribedthis is a two parter, cant answer 16 without 15
there is nothing else needed.
What is the WACC for BearKat Autos (rounded to two decimal places, pick the closest one)? Instructor Hint: We have come a long way! Now we are ready to calculate the WACC. Here is the formula: WACC=wdrd(1T)+wprp+wcrs Please read the following relevant information from the question to figure out the weights: "BearKat Autos has a target capital structure of 40% debt, 5% preferred stock and 55% common equity and their current tax rate is 25%." Wd is the percentage of debt that the company plans to use. In our question, the weight on debt is 40% or 0.4. So Wd is 0.4. The weight on the preferred stock is 5% or 0.05. So the wp is 0.05. The weight on common equity is we, which is 0.55. And we have already known the rest of the variables from the previous steps. You should be able to calculate the WACC. Cheers! ) A. 5.87% B. 6.31% C. 5.48% D. 7.89% QUESTION 16 should this project be undertaken? (Instructor hint: Whether or not to undertake this project is a decision based on the evaluation of WACC and the return the project could bring in. If WACC is higher than the return, then NO. If WACC is less than the return, then YES) A.Yes B. No What is the WACC for BearKat Autos (rounded to two decimal places, pick the closest one)? Instructor Hint: We have come a long way! Now we are ready to calculate the WACC. Here is the formula: WACC=wdrd(1T)+wprp+wcrs Please read the following relevant information from the question to figure out the weights: "BearKat Autos has a target capital structure of 40% debt, 5% preferred stock and 55% common equity and their current tax rate is 25%." Wd is the percentage of debt that the company plans to use. In our question, the weight on debt is 40% or 0.4. So Wd is 0.4. The weight on the preferred stock is 5% or 0.05. So the wp is 0.05. The weight on common equity is we, which is 0.55. And we have already known the rest of the variables from the previous steps. You should be able to calculate the WACC. Cheers! ) A. 5.87% B. 6.31% C. 5.48% D. 7.89% QUESTION 16 should this project be undertaken? (Instructor hint: Whether or not to undertake this project is a decision based on the evaluation of WACC and the return the project could bring in. If WACC is higher than the return, then NO. If WACC is less than the return, then YES) A.Yes B. No

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