Question
What is the WACC for a firm with the following information? dividend on common stock = $3.10 common stock beta = 1.46 coupon rate on
What is the WACC for a firm with the following information?
dividend on common stock = $3.10
common stock beta = 1.46
coupon rate on your corporate bond issue = 6.0%
corporate tax rate = 31.0%
current price of your corporate bond issue = $1,261.59
5-year Treasury note yield = 3.0%
current common stock price = $44.81
total liabilities = $12.7 million
total assets = $29.4 million
promised growth rate on common stock dividends = 2.5% per year
time to maturity on corporate bond issue = 8 years
Enter your answer as a regular percentage rate, rounded to the first decimal. Do not enter dollar signs, percent signs, or commas. For example, if you calculated 0.0919, you should enter 9.2. Or if you calculated 0.13483, you should enter 13.5. Answers are counted correct with an error term of +/ .025.
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