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Zietlow Corporation has 2.1 million shares of common stock outstanding with a book value per share of 455 with a recent divided of 65. The
Zietlow Corporation has 2.1 million shares of common stock outstanding with a book value per share of 455 with a recent divided of 65. The firm's capital also includes 2900 shares of 4.2% preferred. stock outstanding with a par value of 100 and the firms debt include 2620 5.5 percent quarterly bonds outstanding with 35 years maturity issued five years ago. The current trading price of the preferred stock and bonds are 106% of its par value and comomon stock trades for 155 with a constant growth rate of 16%. The beta of the stock is 1.13 and the market risk premium is 7% Calculate the after tax Weighted Avergae Cost of Capital of the firm assuming a tax rate of 30% (Must show the steps of calculation)
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