You are given the following information for Lightning Power Co. Assume the company’s tax rate is 21 percent. Debt: 6,000 5.5 percent coupon bonds outstanding, $1,000 par value, 21 years to maturity, selling for 103 percent of par; the bonds make semiannual payments. Common stock: 390,000 shares outstanding, selling for $57 per share; beta is 1.14. Preferred stock: 16,500 shares of 3.3 percent preferred stock outstanding, currently selling for $78 per share. The par value is $100 per share. Market: 5 percent market risk premium and 4.3 percent risk-free rate. What is the company's WACC? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)

You are given the following information for Lightning Power Co. Assume the company’s tax rate is 21 percent. Debt: 6,000 5.5 percent coupon bonds outstanding, $1,000 par value, 21 years to maturity, selling for 103 percent of par; the bonds make semiannual payments. Common stock: 390,000 shares outstanding, selling for $57 per share; beta is 1.14. Preferred stock: 16,500 shares of 3.3 percent preferred stock outstanding, currently selling for $78 per share. The par value is $100 per share. Market: 5 percent market risk premium and 4.3 percent risk-free rate. What is the company's WACC? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)

EBK CONTEMPORARY FINANCIAL MANAGEMENT

14th Edition

ISBN:9781337514835

Author:MOYER

Publisher:MOYER

Chapter20: Financing With Derivatives

Section: Chapter Questions

Problem 14P

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You are given the following information for Lighting Power Company. Assume the company's tax rate is 21 percent. Debt: Common stock: Preferred stock: Market: 6,000 5.5 percent coupon bonds outstanding, $1,000 par value, 21 years to maturity, selling for 103 percent of par; the bonds make semiannual payments. 390,000 shares outstanding, selling for $57 per share; the beta is 1.14. 16,500 shares of 3.3 percent preferred stock outstanding, a $100 par value, currently selling for $78 per share. 5 percent market risk premium and 4.3 percent risk-free rate. What is the company's WACC? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) WACC %
You are given the following information for Lightning Power Co. Assume the company's tax rate is 24 percent. Debt: 19,000 6.8 percent coupon bonds outstanding, $1,000 par value, 24 years to maturity, selling for 111 percent of par; the bonds make semiannual payments. Common 520,000 shares outstanding, selling for $70 per share; beta is 1.21. stock: Preferred stock: 23,000 shares of 4.6 percent preferred stock outstanding, currently selling for $91 per share. The par value is $100 per share. Market: 6 percent market risk premium and 5.5 percent risk-free rate. What is the company's WACC? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) WACC %
You are given the following information for Lightning Power Company. Assume the company's tax rate is 21 percent. Debt: Common stock: Preferred stock: Market: 16,000 6.5 percent coupon bonds outstanding, $1,000 par value, 27 years to maturity, selling for 105 percent of par; the bonds make semiannual payments. 490,000 shares outstanding, selling for $67 per share; beta is 1.18. 21,500 shares of 4.3 percent preferred stock outstanding, a $100 par value, selling for $88 per share. 6 percent market risk premium and 5.4 percent risk-free rate. What is the company's WACC? Note: Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16. Answer is complete but not entirely correct. WACC 8.53%
You are given the following information for Lightning Power Co. Assume the company's tax rate is 22%. Debt: 12000, 6.1% coupon bonds outstanding, $1,000 par value, 27 years to maturity, selling for 109% of par. The bonds make semiannual payments. Common stock: 450,000 shares outstanding selling for $63 per share. The beta is 1.14 Preferred stock: 19,500 shares of 3.9% preferred stock outstanding, currently selling for $84 per share. The Par value is $100 per share. Market: 5% market risk premium and 4.9% risk free rate. What is the company's WACC?
You are given the following Information for Lighting Power Company. Assume the company's tax rate is 22 percent. 17,000 6.6 percent coupon bonds outstanding, $1,000 par value, 26 years to maturity, selling for 106 percent of par; the bonds make semiannual payments. Debt: Common 500,000 shares outstanding, selling for $68 per share; the beta is 1.19. stock: 22,000 shares of 4.4 percent preferred stock outstanding, a $100 par value, currently selling for $89 per share. Preferred stock: Market: 7 percent market risk premlum and 5.5 percent risk-free rate. What is the company's WACC? (Do not round Intermedlate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) WACC
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You are given the following information for Lighting Power Company. Assume the company’s tax rate is 25 percent. Debt: 10,000 5.9 percent coupon bonds outstanding, $1,000 par value, 25 years to maturity, selling for 107 percent of par; the bonds make semiannual payments. Common stock: 430,000 shares outstanding, selling for $61 per share; the beta is 1.12. Preferred stock: 18,500 shares of 3.7 percent preferred stock outstanding, a $100 par value, currently selling for $82 per share. Market: 6 percent market risk premium and 4.7 percent risk-free rate. What is the company's WACC? (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.)
Given the following information for Dicey Corporation, find the WACC. Assume the company's tax rate is 21 percent. Debt: 10000 corporate bonds, 7.6 percent coupon bonds outstanding. S1,000 par valuc, 18 years to maturity, selling for 102 percent of par, the bonds make semiannual payments. Common stock: 300,000 shares outstanding, selling for $58 per share, beta is 1.36. Preferred stock: 6,000 shares of $8.50 preferred stock outstanding, currently selling for $73 per share. Market: 8.3 percent market risk premium and 3.5 percent risk-free rate. Answer: WACC =
Information on Gerken Power Co., is shown below. Assume the company’s tax rate is 34 percent. Debt: 8,600 7.9 percent coupon bonds outstanding, $1,000 par value, 24 years to maturity, selling for 104.5 percent of par; the bonds make semiannual payments. Common stock: 211,000 shares outstanding, selling for $83.10 per share; beta is 1.16. Preferred stock: 12,100 shares of 5.8 percent preferred stock outstanding, currently selling for $97.90 per share. Market: 7.05 percent market risk premium and 4.85 percent risk-free rate. Required:Calculate the company's WACC. (Do not round intermediate calculations and enter your answer as a percent rounded to 2 decimal places, e.g., 32.16.) WACC %

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Debt:	6,000 5.5 percent coupon bonds outstanding, $1,000 par value, 21 years to maturity, selling for 103 percent of par; the bonds make semiannual payments.

Common stock:	390,000 shares outstanding, selling for $57 per share; beta is 1.14.

Preferred stock:	16,500 shares of 3.3 percent preferred stock outstanding, currently selling for $78 per share. The par value is $100 per share.

Market:	5 percent market risk premium and 4.3 percent risk-free rate.