Consider the following information for Evenflow Power Co., |
Debt: | 2,500 9 percent coupon bonds outstanding, $1,000 par value, 21 years to maturity, selling for 105 percent of par; the bonds make semiannual payments. | ||
Common stock: | 60,000 shares outstanding, selling for $58 per share; the beta is 1.12. | ||
Preferred stock: | 8,500 shares of 8 percent preferred stock outstanding, currently selling for $107 per share. | ||
Market: | 11 percent market risk premium and 7.5 percent risk-free rate. | ||
Assume the company's tax rate is 33 percent. |
Required: |
Find the WACC. (Do not round your intermediate calculations.) |
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