Question

Asked Nov 24, 2019

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You are given the following information for Cleen Power Co. Assume the company’s tax rate is 30 percent.

Debt: |
6,000 7.9 percent coupon bonds outstanding, $1,000 par value, 25 years to maturity, selling for 108 percent of par; the bonds make semiannual payments. |

Common stock: | 510,000 shares outstanding, selling for $69 per share; the beta is 1.12. |

Market: | 10 percent market risk premium and 5.9 percent risk-free rate. |

What is the company's WACC? **(Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)**

WACC %

Step 1

**Calculation of WACC:**

The WACC is **15.23%**.

**Excel Spreadsheet:**

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