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You want to estimate the WACC of a company. The beta of this company is 1.25, the risk-free rate is 4.5% and the estimated market
You want to estimate the WACC of a company. The beta of this company is 1.25, the risk-free rate is 4.5% and the estimated market return is 12.5%. In addition, the company has some bonds outstanding in the market selling for $987.25. The bonds have 12 years left to maturity, with 9% coupon rate with semi-annual payments; and $1000 par value. If your companys capital structure is 30% debt and 70% equity, with the tax rate of 30% what is the WACC?
A)12.08%
B)11.41%
C)12.46%
D)13.40%
E)14.01%
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