Question

Time ng: 165 minutes Back to Assignment Deadline Today at 11:34 Attempts: Score: /2.5 6. Chapter b Multiple Choice 09-66, Section b Multiple Choice 09-66, Problem b Multiple Choice 09-66 Assume that you are an intern with the Brayton Company, and you have collected the follo ing data. The yeld on the company's outstanding bends is 7 wi its tax rate is 4 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 s 15.00 per share; the flotation cost for selling new shares is E-10%; and the a. 8.04% b. 8.44% , 7.64% () d. 6.89% @ e. 726% tinue without saving Copyright Notice i s Terms of Use Privacy Notice Security Notice Accossibility O Type here to search 50 PM /17/201

Answer 1

Cost % Market value weights | WACC (Cost %«Weights) 2.56% 2 Common stock 4.65%) $ 55.00 0.55 7.75%*(1-40%) 4 5 Debt (After tax cost 10.81%) $ 45.00 0.45 4.87% 0.65/15"(1-10%)+690 Total S 100.00 1.00 9 10 7.42% 12 Please select nearest option (E) 7.26%