S Corp. is expected to pay a $2.55 dividend at year end, the dividend is expected to grow at a constant rate of 4.50% a year, and the common stock currently sells for $35 a share. The befoes-tax cost of debt in Sand the tax rate is 40%. The target capital structure consists of 60% debt and 40% common equity. What is the company's WACC? Do not round your intermediate calculations.Ⓒa. 8.39%b.9.24 %O c. 6.25 %Od. 6.69%Ⓒ.7.97%

Weighted Average Cost of Capital (WACC) = (Weight of Equity x Cost of Equity) + (Weight of debt x…

S Corp. is expected to pay a $2.55 dividend at year end, the dividend is expected to grow at a constant rate of 4.50% a year, and the common stock cummly sells for $35 a share. The befees-aux cost of debt in S and the tax rate is 40%. The target capital structure consists of 60% debt and 40% common equity. What is the company's WACC? Do not round your intermediate calculations O a. 8.39% Ob.9.24 % O c. 6.25%

S Corp. is expected to pay a $2.55 dividend at year end, the dividend is expected to grow at a constant rate of 4.50% a year, and the common stock cummly sells for $35 a share. The befees-aux cost of debt in S and the tax rate is 40%. The target capital structure consists of 60% debt and 40% common equity. What is the company's WACC? Do not round your intermediate calculations O a. 8.39% Ob.9.24 % O c. 6.25%

Intermediate Financial Management (MindTap Course List)

13th Edition

ISBN:9781337395083

Author:Eugene F. Brigham, Phillip R. Daves

Publisher:Eugene F. Brigham, Phillip R. Daves

Chapter17: Dynamic Capital Structures And Corporate Valuation

Section: Chapter Questions

Problem 3P

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