P14-15 Finding the WACC [LO3]

Consider the following information for Evenflow Power Co.,

Debt:		3,000 8 percent coupon bonds outstanding, $1,000 par value, 21 years to maturity, selling for 104 percent of par; the bonds make semiannual payments.
Common stock:		69,000 shares outstanding, selling for $58 per share; the beta is 1.18.
Preferred stock:		10,500 shares of 7 percent preferred stock outstanding, currently selling for $106 per share.
Market:		9.5 percent market risk premium and 6 percent risk-free rate.

Assume the company's tax rate is 32 percent.

Required:

Find the WACC. (Do not round your intermediate calculations.)

12.14%

11.38%

11.62%

11.22%

11.12%