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Consider the following information for GAP, Inc.,      Debt: 3,000 9 percent coupon bonds outstanding, $1,000...

Consider the following information for GAP, Inc.,

  

  Debt: 3,000 9 percent coupon bonds outstanding, $1,000 par value, 21 years to maturity, selling for 102 percent of par; the bonds make semiannual payments.
  Common stock: 63,000 shares outstanding, selling for $60 per share; the beta is 1.16.
  Preferred stock: 10,000 shares of 8 percent preferred stock outstanding, currently selling for $105 per share.
  Market: 10 percent market risk premium and 8 percent risk-free rate.

  

Assume the company's tax rate is 35 percent.

  

Required:

  

Find the WACC. (Do not round your intermediate calculations.)

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jeff jeffy answered 1 year ago
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