Question: Wippet Industries (WI) has a book value capital structure as shown below.
- Bonds pay annual coupons of $91
- Have 6 years to go until they mature
- Have a YTM of 7%
- Stock sells for $22 per share
- Has a beta of 1.39
- Expected return on the market is 12%
- t-bills pay 3.3%.
- Taxes are 32%.
What is the WACC for WI?