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  3. 8. roll tide, inc. has 10,000 shares of common sto

8. Roll Tide, Inc. has 10,000 shares of common stock outstanding at a price of...

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Accounting

8. Roll Tide, Inc. has 10,000 shares of common stock outstanding at a price of $18 a share. The firms beta is 1.3 and the market risk premium is 6.5%. The Treasury bill rate is 3.5%. There are 9,000 shares of preferred stock outstanding at a price of $22 a share; each quarterly dividend payment on preferred stock is $0.45. Roll Tides has 400 bonds 15 year bonds which have 6 years left to maturity. They pay a coupon rate of 7% and are trading at 105% of par. The tax rate is 34 percent. What is the weighted average cost of capital for the firm? (10 points)

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