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Seven years ago, B Company issued 3,000 semi-annual bonds at a par value of $1,000 and...

Seven years ago, B Company issued 3,000 semi-annual bonds at a par value of $1,000 and a coupon rate of 7.75%. The bonds had an original maturity of 20 years. These bonds are now trading in the open market for $1,080. The company's tax rate is 35% and its most recent dividend was $3.15. The company's dividends have been growing at 2.75% annually and they are expected to continue growing at the same rate. The price of B Company stock is now trading for $40.25 per share and there are currently 135,000 shares outstanding. What is the current WACC for B Company?

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NO INTERMEDIATE ROUNDING IS DONE. THANK YOU.

jeff jeffy answered 1 year ago
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