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  3. how does a higher beta affect wacc and why? how do

How does a higher beta affect WACC and why? How does a drop in the bond...

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Finance

  1. How does a higher beta affect WACC and why?
  2. How does a drop in the bond market effect WACC and why?
  3. What is the WACC for a public utility given the followinginformation: beta: 0.8, expected rate of return on the S&P 500:12.4%, risk-free rate (T-bill yield): 4%, yield to maturity onlong-term bonds: 7.2%, required rate of return on preferred stock:7.5%, common equity ratio: 60%, debt ratio: 30%, preferred stockratio: 10% and an effective corporate tax rate: 30%.

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