6.67 pts A company's capital structure consists of 40% debt and 60% equity. The yield on this company's bonds is currently 8.75%. The beta of this company is 0.75, the risk-free rate is 4.5% and the expected return on the market is 12.5%. The tax rate of this company is 21%. What is the WACC for this company? O 11.66% O 15.08% O 10.18% O 9.07% 13.94%

Intermediate Financial Management (MindTap Course List)
13th Edition
ISBN:9781337395083
Author:Eugene F. Brigham, Phillip R. Daves
Publisher:Eugene F. Brigham, Phillip R. Daves
Chapter11: Determining The Cost Of Capital
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6.67 pts
A company's capital structure consists of 40% debt and 60% equity. The yield on this company's bonds is currently 8.75%. The beta
of this company is 0.75, the risk-free rate is 4.5% and the expected return on the market is 12.5%. The tax rate of this company is
21%. What is the WACC for this company?
O 11.66%
O 15.08%
O 10.18%
O 9.07%
13.94%
Transcribed Image Text:6.67 pts A company's capital structure consists of 40% debt and 60% equity. The yield on this company's bonds is currently 8.75%. The beta of this company is 0.75, the risk-free rate is 4.5% and the expected return on the market is 12.5%. The tax rate of this company is 21%. What is the WACC for this company? O 11.66% O 15.08% O 10.18% O 9.07% 13.94%
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