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An analyst has collected the following information regarding Christopher Co.: • The company’s capital structure is 70...

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Finance

An analyst has collected the following information regardingChristopher Co.:

• The company’s capital structure is 70 percent equity, 30percent debt.

• The yield to maturity on the company’s bonds is 9 percent.

• The company’s year-end dividend is forecasted to be $0.80 ashare.

• The company expects that its dividend will grow at a constantrate of 9 percent a year.

• The company’s stock price is $25.

• The company’s tax rate is 40 percent.

• The company anticipates that it will need to raise new commonstock this year. Its investment bankers anticipate that the totalflotation cost will equal 10 percent of the amount issued. Assumethe company accounts for flotation costs by adjusting the cost ofcapital. Given this information, calculate the company’s WACC

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