The bonds make semiannual payments-common stock-debt

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Reference no: EM131575517

Consider the following information for Evenflow Power Co.,

Debt: 4,500 8.5 percent coupon bonds outstanding, $1,000 par value, 19 years to maturity, selling for 102 percent of par; the bonds make semiannual payments.

Common stock: 99,000 shares outstanding, selling for $58 per share; the beta is 1.06.

Preferred stock: 13,000 shares of 8 percent preferred stock outstanding, currently selling for $105 per share.

Market: 9.5 percent market risk premium and 7 percent risk-free rate.

Assume the company's tax rate is 34 percent.

Required: Find the WACC. (Do not round your intermediate calculations.)

a.) 11.82%

b.) 11.42%

c.) 12.52%

d.) 11.32%

e.) 11.5%

Reference no: EM131575517

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