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Calculate the firms wacc

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Reference no: EM131147064

A company has determined that its optimal capital structure consists of 40 percent debt and 60 percent equity.

Assume the fwill not have enough retained earnings to find the equity portion of its capital budget.

Also, assume the firm accounts for flotation costs by adjusting the cost of capital.

Given the following information, calculate the firm's WACC. rd=8%,D0=$2.00, Tax rate=40%, p0=$25, Growth=0%,flotation cost on common equity=15%.

Reference no: EM131147064

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