What is company wacc

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Reference no: EM131535140

You are given the following information for Watson Power Co. Assume the company’s tax rate is 40 percent.

Debt: 10,000 6 percent coupon bonds outstanding, $1,000 par value, 15 years to maturity, selling for 105 percent of par; the bonds make semiannual payments.

Common stock: 300,000 shares outstanding, selling for $50 per share; the beta is 1.50.

Preferred stock: 15,000 shares of 10 percent preferred stock outstanding, currently selling for $100 per share.

Market: 10 percent market risk premium and 6 percent treasure bill rate.

What is the company's WACC?

With each step written

Reference no: EM131535140

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