Crowsnest Industrial has the following capital structure information: Stock price (market) = $15...
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Finance
Crowsnest Industrial has the following capital structure information:
Stock price (market) = $15
Number of shares outstanding = 4,000,000
Book value of common stock = $30,000,000
Book value of bonds = $20,000,000
Number of bonds outstanding = 20,000
Bond price = $880
Assuming the company is operating at its target capital structure what are the appropriate weights to use for calculating WACC?
a. Equity 63%, Debt 37%
b. Equity 77%, Debt 23%
c. Equity 75%, Debt 25%
d. Equity 60%, Debt 40%
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