The current stock price for company is 32 per share and


The current stock price for a company is $32 per share, and there are 6 million shares outstanding. The beta for this firms stock is 1.4, the risk-free rate is 4.2, and the expected market risk premium is 5.7%. This firm also has 270,000 bonds outstanding, which pay interest semiannually. These bonds have a coupon interest rate of 8%, 11 years to maturity, a face value of $1,000, and a current price of 1,035.78. If the corporate tax rate is 31%, what is the Weighted Average Cost of Capital (WACC) for this firm?

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Financial Management: The current stock price for company is 32 per share and
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