Transcribed Image Text
The current stock price for a company is $33 per share, andthere are 7 million shares outstanding. The beta for this firmsstock is 0.9, the risk-free rate is 4.8, and the expected marketrisk premium is 6.2%. This firm also has 50,000 bonds outstanding,which pay interest semiannually. These bonds have a coupon interestrate of 7%, 19 years to maturity, a face value of $1,000, and anannual yield to maturity of 7.8%. If the corporate tax rate is 34%,what is the Weighted Average Cost of Capital (WACC) for this firm?(Answer to the nearest hundredth of a percent, but do not use apercent sign).
Other questions asked by students
Finance
Finance
Q
Consider the following. optimize f(r, p) = 3r2 + rp − p2 + p subject to g(r, p) = 3r + 4p...
Basic Math
Civil Engineering
General Management
Accounting