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you are given the following information about a company Debt

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you are given the following information about a company:

Debt: 7000 8.5% coupon bonds outstanding with 20 years to maturity quoted at a price of 97. Bonds pay semi annual interest.

Common Stock 220,000 shares selling at 60 per share. The stock has a beta of .90 and will pay a dividend of 1.80 The dividend is expected to grow at 6% per year indefinitely.

Preferred stock: 19,000 shares of 6.5% preferred stock selling at 94 a share

Market: 12% expected return and a 4% risk free rate. Company is in 35% tax bracket.

What is the WACC for this company?
Submitted: 6 years ago.
Category: Homework
Expert:  Annie Kavitha replied 6 years ago.



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Customer: replied 6 years ago.
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