Calculate the wacc-nevada mining co

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Nevada Mining Co. has only long term debt of $600. This debt consist of long term bond which has following features: face value is $1000, time to maturity is 40 years, and annual coupon rate is 0.13. These bond is currently traded in the market at a price of $1,505. Regarding the equity, the current stock price of the shares are $59 and the firms has 13 shares outstanding. Nevada Mining Co. is planning to distribute $11 dividend per share and these dividends are expected to grow 0.06 each year. If the tax rate of Nevada Mining Co. is 0.40, calculate the WACC. Show your steps in your calculations.

Reference no: EM132740212

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