A stock has paid $3 of annual dividends. The dividends are expected to grow at a rate of 8% per year, and the stock currently sells for $67 The before-tax cost of debt is 4%, and the tax rate is 20% The target capital structure consists of 37% debt and 63% common equity. What is the company's WACC? O8.44% O9.55 % O9.73% 0927% 08.81%

A stock has paid $3 of annual dividends. The dividends are expected to grow at a rate of 8% per year, and the stock currently sells for $67 The before-tax cost of debt is 4%, and the tax rate is 20% The target capital structure consists of 37% debt and 63% common equity. What is the company's WACC? O8.44% O9.55 % O9.73% 0927% 08.81%

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter12: The Cost Of Capital

Section: Chapter Questions

Problem 7P

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