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Time Warner shares have a market capitalization of $45 billion. The company just paid a dividend of $0.40 per share and each share trades for

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Time Warner shares have a market capitalization of $45 billion. The company just paid a dividend of $0.40 per share and each share trades for $25. The growth rate in dividends is expected to be 7.5% per year. Also, Time Warner has $15 billion of debt that trades with a yield to maturity of 8%. If the firm's tax rate is 25%, compute the WACC? A. 8.42% B. 7.99% C. 9.68% D. 9.26%

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