Question

Using the following information calculate the WACC of Raj Ltd.

The company has 0.3 million shares outstanding at a price of $92 per share. The
beta of common stock of is 1.2. The risk-free rate is 5% and the market risk
premium is 7%.
The company issued 11% preference shares with a total value of $ 25 million.
The company issued 9% bonds of $33.6 million.
The company pays corporate tax at 40 percent.
A. 9.59%
B. 9.89%
C. 10.99%
D. d.8.35%

Answer 1

Answer:

Answer is a 10.99%

Explanation:

10.99%