Question

BAC Mining Corporation has 8.5 million shares of common stock outstanding and 290,000 4.7 percent semiannual...

BAC Mining Corporation has 8.5 million shares of common stock outstanding and 290,000 4.7 percent semiannual bonds outstanding, par value $1,000 each. The common stock currently sells for $33 per share and has a beta of 1.25; the bonds have a yield to maturity of 3.06% and sell for 114 percent of par. The market risk premium is 7.3 percent, T-bills are yielding 6 percent, and the company’s tax rate is 25 percent. What is the company's WACC?

Group of answer choices

8.18%

4.74%

8.85%

Homework Answers

Answer #1

Hello, consider upvoting the answer, it helps a lot and if you have any questions, feel free to ask in the comments section.

Calc:

Know the answer?
Your Answer:

Post as a guest

Your Name:

What's your source?

Earn Coins

Coins can be redeemed for fabulous gifts.

Not the answer you're looking for?
Ask your own homework help question
Similar Questions
BHC Mining Corporation has 3 million shares of common stock outstanding and 90,000 9 percent semiannual...
BHC Mining Corporation has 3 million shares of common stock outstanding and 90,000 9 percent semiannual bonds outstanding, par value $1,000 each. The common stock currently sells for $40 per share and has a beta of 1.1; the bonds have a yield to maturity of 7% and sell for 105 percent of par. The market risk premium is 12 percent, T-bills are yielding 2 percent, and the company’s tax rate is 34 percent. What is the company's WACC? Group of...
Titan Mining Corporation has 7.8 million shares of common stock outstanding, 290,000 shares of 4.3 percent...
Titan Mining Corporation has 7.8 million shares of common stock outstanding, 290,000 shares of 4.3 percent preferred stock outstanding, and 175,000 bonds with a semiannual coupon rate of 5.9 percent outstanding, par value $2,000 each. The common stock currently sells for $59 per share and has a beta of 1.05, the preferred stock has a par value of $100 and currently sells for $97 per share, and the bonds have 16 years to maturity and sell for 103 percent of...
Titan Mining Corporation has 9.5 million shares of common stock outstanding and 390,000 4.9 percent semiannual...
Titan Mining Corporation has 9.5 million shares of common stock outstanding and 390,000 4.9 percent semiannual bonds outstanding, par value $1,000 each. The common stock currently sells for $43 per share and has a beta of 1.15; the bonds have 15 years to maturity and sell for 114 percent of par. The market risk premium is 8.3 percent, T-bills are yielding 4 percent, and the company’s tax rate is 25 percent.    a. What is the firm's market value capital...
Nike has 9 million shares of common stock outstanding and 12,000 8.5% semiannual bonds outstanding, par...
Nike has 9 million shares of common stock outstanding and 12,000 8.5% semiannual bonds outstanding, par value of $10,000 each. Common stock currently sells for $34 per share and has a beta of 1.20. The bonds have 15 years to maturity and sell for 93% of par. The market risk premium is 10%, Tbills are yielding 5% and the firm’s tax rate is 35%. Find Nike’s weighted average cost of capital (WACC).
Titan Mining Corporation has 6.5 million shares of common stock outstanding, 230,000 shares of 3.8 percent...
Titan Mining Corporation has 6.5 million shares of common stock outstanding, 230,000 shares of 3.8 percent preferred stock outstanding, and 115,000 bonds with a semiannual coupon rate of 5.5 percent outstanding, par value $1,000 each. The common stock currently sells for $71 per share and has a beta of 1.05, the preferred stock has a par value of $100 and currently sells for $85 per share, and the bonds have 19 years to maturity and sell for 109 percent of...
Titan Mining Corporation has 10.1 million shares of common stock outstanding and 440,000 4.4 percent semiannual...
Titan Mining Corporation has 10.1 million shares of common stock outstanding and 440,000 4.4 percent semiannual bonds outstanding, par value $1,000 each. The common stock currently sells for $48 per share and has a beta of 1.05; the bonds have 10 years to maturity and sell for 115 percent of par. The market risk premium is 8.8 percent, T-bills are yielding 5 percent, and the company’s tax rate is 25 percent.    a. What is the firm's market value capital...
Hankins Corporation has 8.8 million shares of common stock outstanding, 630,000 shares of 7.3 percent preferred...
Hankins Corporation has 8.8 million shares of common stock outstanding, 630,000 shares of 7.3 percent preferred stock outstanding, and 188,000 of 8.5 percent semiannual bonds outstanding, par value $1,000 each. The common stock currently sells for $65.30 per share and has a beta of 1.33, the preferred stock currently sells for $106.70 per share, and the bonds have 14 years to maturity and sell for 89.5 percent of par. The market risk premium is 6.95 percent, T-bills are yielding 5.65...
Raymond Mining Corporation has 8.4 million shares of common stock outstanding, 280,000 shares of 6 percent...
Raymond Mining Corporation has 8.4 million shares of common stock outstanding, 280,000 shares of 6 percent $100 par value preferred stock outstanding, and 141,000 7.50 percent semiannual bonds outstanding, par value $1,000 each. The common stock currently sells for $32 per share and has a beta of 1.20, the preferred stock currently sells for $94 per share, and the bonds have 20 years to maturity and sell for 113 percent of par. The market risk premium is 7.2 percent, T-bills...
Titan Mining Corporation has 7.3 million shares of common stock outstanding, 265,000 shares of 4.5 percent...
Titan Mining Corporation has 7.3 million shares of common stock outstanding, 265,000 shares of 4.5 percent preferred stock outstanding, and 150,000 bonds with a coupon rate of 5.4 percent outstanding, par value $1,000 each. The common stock currently sells for $64 per share and has a beta of 1.20. The preferred stock has a par value of $100 and currently sells for $92 per share. The bonds have 16 years to maturity, pay semiannual coupons, and sell for 106 percent...
Titan Mining Corporation has 8.8 million shares of common stock outstanding, 320,000 shares of 4 percent...
Titan Mining Corporation has 8.8 million shares of common stock outstanding, 320,000 shares of 4 percent preferred stock outstanding, and 170,000 7.6 percent semiannual bonds outstanding, par value $1,000 each. The common stock currently sells for $36 per share and has a beta of 1.40, the preferred stock currently sells for $86 per share, and the bonds have 10 years to maturity and sell for 117 percent of par. The market risk premium is 7.6 percent, T-bills are yielding 5...