Their capital structure consists of: $5 million in loans at a stated rate of 5%, $5 million in bonds that sold at par for $1000 (flotation costs were $26 per bond, coupon rate 4.5%, 10 years to maturity) $10 million in common stock with the most recent dividend of $1.20, growth rate of 5%, current stock price of $35. 40% tax rate.

What is their WACC?

Answer rating: 100% (QA)

Calculating Weighted Average Cost of Capital WACC for the company To calculate the WACC we need to c... View the full answer