Lululemon Athletica's share is currently trading at $50, and its market capitalization is $7 million. The firm's
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Lululemon Athletica's share is currently trading at $50, and its market capitalization is $7 million. The firm's beta is 1.5, the risk-free rate is 2.4%, and the market risk premium is 6%. The firm has 5000 bonds outstanding.The face value of each bond is $1000 and will mature in 10 years.The coupon rate is 8%, and the coupon is paid on an annual basis.The bonds aretrading at 110% of the face value.The firm's tax rate is 35%.
What is Lululemon's WACC?If Lululemon were an unlevered firm, then what would be its WACC?
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