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Using the following information about Drew Co. Inc. and the market (SPY), what is the Weighted Average Cost of Capital for DCI? Please answer as

Using the following information about Drew Co. Inc. and the market (SPY), what is the Weighted Average Cost of Capital for DCI? Please answer as a % without the % sign. Drew Co. Inc DCI Stock Price #shares Outstanding Corporate Tax Rate = Risk-Free Rate 80.80 250,000 40.00% 3.00% Mkt Price (Quoted % of Par) Par Value 50.00 70.00 10 yr Zero Coupon Bond 20 Yr (semi-annual,) Bond Coupon Rate Preferred Shares Pref. Payment Rate 10,000,000 10,000,000 5.00% 10,000,000 12.00% 131.00 Stock Returns DCI SPY Year 1 WN - 2 16.0% 15.0% 1.0% 6.0% 11.0% 10.0% 4.0% 3.0% 3 Answer: Using the following information about Drew Co. Inc. and the market (SPY), what is the Weighted Average Cost of Capital for DCI? Please answer as a % without the % sign. Drew Co. Inc DCI Stock Price #shares Outstanding Corporate Tax Rate = Risk-Free Rate 80.80 250,000 40.00% 3.00% Mkt Price (Quoted % of Par) Par Value 50.00 70.00 10 yr Zero Coupon Bond 20 Yr (semi-annual,) Bond Coupon Rate Preferred Shares Pref. Payment Rate 10,000,000 10,000,000 5.00% 10,000,000 12.00% 131.00 Stock Returns DCI SPY Year 1 WN - 2 16.0% 15.0% 1.0% 6.0% 11.0% 10.0% 4.0% 3.0% 3

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