company has a capital structure that uses 45% common equity, 20% preferred shares, and 35% debt. The preferred shares have a current yield of 4.9%. The debt has a coupon rate of 13.7% and a current yield to maturity of 6.3%. The common shares have a yield of 8.6%. There are no taxes. What is the firm's WACC? Enter answer as percentage, rounded to the nearest hundredth. For example, if your answer is 7.6832%, enter 7.68.

company has a capital structure that uses 45% common equity, 20% preferred shares, and 35% debt. The preferred shares have a current yield of 4.9%. The debt has a coupon rate of 13.7% and a current yield to maturity of 6.3%. The common shares have a yield of 8.6%. There are no taxes. What is the firm's WACC? Enter answer as percentage, rounded to the nearest hundredth. For example, if your answer is 7.6832%, enter 7.68.

Corporate Fin Focused Approach

5th Edition

ISBN:9781285660516

Author:EHRHARDT

Publisher:EHRHARDT

Chapter9: The Cost Of Capital

Section9.8: The Weighted Average Cost Of Capital (wacc)

Problem 3ST

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