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  3. you are looking at the following information: debt

You are looking at the following information: Debt: Common stock: 3,000 5.5 percent coupon bonds...

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Accounting

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You are looking at the following information: Debt: Common stock: 3,000 5.5 percent coupon bonds outstanding, $1,000 par value, 17 years to maturity, selling for 105 percent of par; the bonds make semiannual payments. 60,000 shares outstanding, selling for $59 per share; the beta is 1.2. 10,500 shares of 4.5 percent preferred stock (review my Ch.8 slide 43: what does "...% preferred stock" phrase mean?) outstanding, currently selling for $106 per share. 7 percent market risk premium and 4 percent risk-free rate. Preferred stock: Market: The company is in the 34 percent tax rate bracket based on its corporate income. Required: Find the WACC. (Do not round your intermediate calculations.)

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