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Huntington Power Co - WACC - 20 Mar, 2012

Finding the WACC Given the following information for Huntington Power Co., find the WACC. Assume the company's tax rate is 35 percent.

Debt: 5,000 8 percent coupon bonds outstanding, $1,000 par value, 20 years to maturity, selling for 103 percent of par; the bonds make semiannual payments.

Common stock: 160,000 shares outstanding, selling for $57 per share; the beta is 1.10. Market: 7 percent market risk premium and 6 percent risk-free rate.



Category : Financial Management

Search Keywords :
Huntington , Power , Cost , Debt , Equity , Proportion , Bond , Common , WACC 


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Answer  - 20 Mar, 2012
We need to calculate the component cost and the proportions. We first calcu....


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