The current stock price for a company is 40 per share and, Ask an Expert

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The current stock price for a company is $40 per share, and there are 3 million shares outstanding. The beta for this firms stock is 1.2, the risk-free rate is 4.7, and the expected market risk premium is 5.9%. This firm also has 180,000 bonds outstanding, which pay interest semiannually. These bonds have a coupon interest rate of 7%, 16 years to maturity, a face value of $1,000, and a current price of 926.36. 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 a percent sign).

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Financial Management, Finance

Category:- Financial Management
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