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QUESTION

Your Company estimates its WACC. You know the following information: The company's capital structure consists of 60% common equity and 40% debt b....

1.     Your Company estimates its WACC. You know the following information:

a. The company's capital structure consists of 60% common equity and 40% debt

b. Tax rate is 40%

c. Your company has 20-year bonds outstanding with a 9%annual coupon and currently that bond is trading at par

d. 5.5% is the risk-free rate

e. 5% is the market risk premium

f. 1.4 - is the company stock's beta

Calculate the company's WACC.

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