Question: Please show all work. GM has bonds with a face value of $15,000,000 outstanding. The bonds have an 8% semi-annual coupon rate, 15 years to
GM has bonds with a face value of $15,000,000 outstanding. The bonds have an 8% semi-annual coupon rate, 15 years to maturity, a $1,000 face value, and a $1,100 market price. The company has 100,000 preferred shares that sell for $30 with a $6 dividend. The company's 850,000 shares of common stock sell for $35 per share and have a beta of 2.5. The risk free rate is 4%, and the market return is 13%. Assuming a 35% tax rate, what is GM's WACC
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