Question

_{Please calculate the company’s WACC based on the following information:}

_Equity:

_{$3 per share of dividend payment in next year; annual dividend payment; steady dividend growth rate of 3% per year; $30 per share; 200 million shares outstanding}

_Debt:

_{3 billion debt; interest expense of 240 million}

_{Preferred stock:}

_{$500 per share; 2 million shares outstanding; dividend of $25 per payment; Semiannual dividend payment}

Average corporate tax rate of 25%

Answer 1