Average cost of capital for ajax corporation

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Reference no: EM131757815

The following relates to Ajax Corporation:

Capital Structure:

40% Common equity

15% Preferred stock

45% Debt

Additional Information:

Corporate tax rate = 34%

Preferred stock dividend = $8.50

Expected common share dividend = $2.50

Expected constant growth rate = 7.00%

Bond coupon rate = 11.00%

Bond yield = 9.50%

Price of preferred stock = $105.00

Price of common stock = $75.00

What is the weighted-average cost of capital for Ajax Corporation?

Reference no: EM131757815

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