1. A company has three bonds they've issuedone's with coupon rates of 4.5%, 4.75%, and 5.2%. Together, the bonds are listed on their SFP at $300 million. The three have been priced in the market to provide a YTM of 6.6%. The company also has one 8.3% outstanding bank loan of $30 million. Their equity consists entirely of common stock, valued at $470 million, which recently has been providing investors with a return of 8.5%. What is the company's weighted average cost of capital?

Solve this problem step by step

Answer rating: 100% (QA)

To calculate the weighted average cost of capital WACC for the company we need to determine the weig... View the full answer