Business
Business, 02.12.2019 22:31, jaileen84

Assume that you are an intern with the brayton company, and you have collected the following data: the yield on the company's outstanding bonds is 7.75%; its tax rate is 40%; the next expected dividend is $0.65 a share; the dividend is expected to grow at a constant rate of 6.00% a year; the price of the stock is $15.00 per share; the flotation cost for selling new shares is f = 10%; and the target capital structure is 45% debt and 55% common equity. what is the firm's wacc, assuming it must issue new stock to finance its capital budget?
select one:
a. 6.89%
b. 7.26%
c. 8.04%
d. 7.64%
e. 8.44%

answer
Answers: 3

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