Consider the following information for Evenflow Power Co.,
Debt: 5,000 6 percent coupon bonds outstanding, $1,000 par value, 23 years to maturity, selling for 103 percent of par; the bonds make semiannual payments.
Common stock: 105,000 shares outstanding, selling for $61 per share; the beta is 1.1.
Preferred stock: 16,000 shares of 5 percent preferred stock outstanding, currently selling for $105 per share.
Market: 7.5 percent market risk premium and 4.5 percent risk-free rate.
Assume the company's tax rate is 34 percent.
Required: Find the WACC. (Do not round your intermediate calculations.)
8.65%
8.15%
9.02%
8.35%
8.25%