In: Finance
Information on Janicek Power Co., is shown below. Assume the company’s tax rate is 34 percent. |
Debt: |
10,100 8.7 percent coupon bonds outstanding, $1,000 par value, 24 years to maturity, selling for 96 percent of par; the bonds make semiannual payments. |
Common stock: | 226,000 shares outstanding, selling for $84.60 per share; beta is 1.31. |
Preferred stock: |
13,600 shares of 5.8 percent preferred stock outstanding, currently selling for $96.40 per share. |
Market: | 7.05 percent market risk premium and 4.85 percent risk-free rate. |
Required: |
Calculate the company's WACC. |