What is the company WACC

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Question - Sorensen Systems Inc. is expected to pay a $2.00 dividend at year end (D1 = $2.00), the dividend is expected to grow at a constant rate of 5.0% a year, and the common stock currently sells for $50.00 a share. The before-tax cost of debt is 6%, and the tax rate is 48%. The target capital structure consists of 30% debt and 70% common equity. What is the company's WACC if all the equity used is from retained earnings?

Reference no: EM132930415

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