the task is to determine the WACC for a given firm using what I know about WACC, as well as data I can find through research. My deliverable is a brief report in which I state my determination of WACC, describe and justify how I determined the number, and provide relevant information as to the sources of my data.

I have to choose a publicly traded company that has debt or bonds and common stock to calculate the current WACC. I should be able to find the market capitalization (E) as well as the for any publicly traded company.

So in other words my reply should contain this information.

Your calculated WACC

How data was used to calculate WACC (provide the formula and the formula with your values substituted)

Sources for your data

A discussion of how much confidence you have in your answer, including what the limiting assumptions you made were, if any

I was also provided this to assist, and honestly this has been the hardest class for me and I am literally fighting my way through.

If I would like, I can use the YTM on a bond issue that is not callable as the pre-tax cost of debt for the company.

Assumptions:

As you recall, the formula for WACC is:

rWACC = (E/E+D) rE + D/(E+D) rD (1-TC)

The formula for the required return on a given equity investment is:

ri= rf + i * (RMkt-rf)

RMkt-rf is the Market Risk Premium. For this project, you may assume the Market Risk Premium is 5% unless you can develop a better number.

rf is the risk-free rate. The risk-free rate is normally the yield on US Treasury securities such as a 10-year treasury. For this assignment, please use 3.5%.

You may assume a corporate tax rate of 40%.