Capital structure-Find the WACC

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Reference no: EM13948598

Aberdeen Company has the following capital structure.

Bonds with face amount $40 million, coupon 7%, selling at par,

Bonds with face value $60 million, coupon 6%, 10 years to maturity, selling at 92,

6 million shares of stock, priced at $50 per share, with β = 1.25.

The risk-free rate is 5% and the expected return on the market is 12%. The tax rate of Aberdeen is 32%. Find the WACC of Aberdeen.

Reference no: EM13948598

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