Question: Cafe Corp. has 5 5 0 , 0 0 0 shares outstanding and 7 , 0 0 0 coupon bonds. The shares are currently priced

Cafe Corp. has 550,000 shares outstanding and 7,000 coupon bonds. The shares are currently priced at $28.50 each and have a beta of 1.15. The firm's bonds have a coupon rate of 9.5%(paid semi-annually) and 5 years to maturity. The YTM on the bonds is currently 6.5%.
The expected return on the S&P TX Composite Index is 6.20% and the risk-free rate is 75 basis points. Assume Cafe Corp.'s marginal tax rate is 15%. The firm's WACC is _______ percent.

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