Calculate the wacc


Please assist with the given problem.

A firm has 2,000,000 shares of common stock outstanding with a market price of $2.00 per share. It has 2,000 bonds outstanding, each selling for $1,200. The bonds mature in 15 years, have a coupon rate of 10% and pay coupons annually. The firm's beta is 1.2, the risk free rate is 5%, and the market risk premium is 7%. The tax rate is 34%. Calculate the WACC?

Solution Preview :

Prepared by a verified Expert
Finance Basics: Calculate the wacc
Reference No:- TGS01744848

Now Priced at $20 (50% Discount)

Recommended (96%)

Rated (4.8/5)