Weighted Average Cost of Capital Homework
Information:
1. Capital Structure
a. Debt: $100,000
b. Equity: $100,000
c. Preferred Stock: $50,000
2. Debt
a. Price: $1,153.00
b. Coupon Payment: $50.00
c. Years: 14 Years
3. Preferred Stock
a. Dividend: $3.45
b. Price: $54.43
4. Equity 1 (Constant Growth)
a. Dividend: $4.23
b. Price: $53.12
c. Constant Growth: 10%
5. Equity 2 (CAPM)
a. Return on Market: 10%
b. Return on Risk Free Asset: 3%
c. Beta: .59
6. Tax Rate: 32%
Problem 1: Calculate the 'Weighted Average Cost of Debt'.
Problem 2: Calculate the 'Weighted Average Cost of Preferred Stock'.
Problem 3: Calculate the 'Weighted Average Cost of Equity (Constant Growth)'.
Problem 4: Calculate the 'Weighted Average Cost of Equity (CAPM)'.
Problem 5: Calculate the 'Weighted Average Cost of Capital (Use CAPM for Equity)'.