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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).

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