Consider the following information for Evenflow Power Co., Debt: 3,500 5.5 percent coupon bonds outstanding, $1,000 par value, 22 years to maturity, selling for 102 percent of par;
the bonds make semiannual payments.
Common stock: 84,000 shares outstanding,
selling for $55 per share;
the beta is 1.19. Preferred stock:
10,000 shares of 4.5 percent preferred stock outstanding, currently selling for $103 per share.
Market: 7 percent market risk premium and 4.5 percent risk-free rate.
Assume the company's tax rate is 33 percent.
Required:
Find the WACC.