General Lithograph Corporation uses no preferred stock. The firm's capital structure uses 34% debt (hint: the rest is equity). The marginal tax rate is 28.73% and the before-tax cost of debt is 3.68%. The firm expects to pay a dividend per share of $0.96 next year, and their dividend is expected to grow at 5.38% over the long-run. Their stock currently trades at $16.66 per share. What is General Lithograph's weighted average cost of capital (WACC)? Enter your answer without the "%", and with two decimal places (in other words, if you calculate 9.87%, then just enter 9.87). 8.25 margin of error +/- 0.05
General Lithograph Corporation uses no preferred stock. The firm's capital structure uses 34% debt (hint: the rest is equity). The marginal tax rate is 28.73% and the before-tax cost of debt is 3.68%. The firm expects to pay a dividend per share of $0.96 next year, and their dividend is expected to grow at 5.38% over the long-run. Their stock currently trades at $16.66 per share. What is General Lithograph's weighted average cost of capital (WACC)? Enter your answer without the "%", and with two decimal places (in other words, if you calculate 9.87%, then just enter 9.87). 8.25 margin of error +/- 0.05
Chapter15: Capital Structure Decisions
Section: Chapter Questions
Problem 8P
Related questions
Question
Expert Solution
This question has been solved!
Explore an expertly crafted, step-by-step solution for a thorough understanding of key concepts.
Step by step
Solved in 1 steps
Recommended textbooks for you
EBK CONTEMPORARY FINANCIAL MANAGEMENT
Finance
ISBN:
9781337514835
Author:
MOYER
Publisher:
CENGAGE LEARNING - CONSIGNMENT