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XYZ Company's stock is currently selling for $ 6 1 per share, with the last dividends paid being $ 2 . 2 7 per share.

XYZ Company's stock is currently selling for $61 per share, with the last dividends paid being $2.27 per share. XYZ is expected to grow at a constant rate of 8.32 percent indefinitely. The risk-free rate is 4 percent, the market risk premium is 6.6 percent, and XYZ's beta is 1.25. XYZ's annual bonds mature in 25 years with an 8.32 percent coupon rate. The par value of the bonds is $1000, and interest payments are made annually. The bonds are currently selling for $972 per bond.
XYZ's target capital structure is 42% debt and 58% common equity, with a tax rate of 40%.

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