Annual coupon bonds with maturity

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Reference no: EM131333831

TAFKAP Industries has 4 million shares of stock outstanding selling at $17 per share, and an issue of $24 million in 7.5 percent annual coupon bonds with a maturity of 20 years, selling at 106 percent of par. Assume TAFKAP’s weighted average tax rate is 34 percent and its cost of equity is 12.5 percent.

What is TAFKAP’s WACC?

Reference no: EM131333831

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