Calculate the firms wacc illustrating the work

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The book value of ABC `s debt is $575,000,000 {market value is $750,000,000} and the total market value of the firm is $2,640,000,000 {includes market value of preferred shares of $225,000,000}. The cost of debt is 12%; Current Prime rate is 6%; the t-bill {risk free rate} is 50% of the Prime rate, the cost of common equity is 18%; the cost of preferred shares is 19%; and the firm's tax rate is 38%. Calculate the firm's WACC illustrating your work.

Reference no: EM13333422

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