What is C4s weighted average cost of capital

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Reference no: EM131347602

C4's stock sells for $60, just paid annual dividend of $3 per share and expects the growth rate to be 5% annually. C4 also has $1000 face value bonds maturing in 8 years. the bonds have an 8% coupon rate (quarterly payments) and currently sell for $1080. C4 maintains a constant debt to equity ratio of 0.5 and the tax rate is 30%.

What is C4's weighted average cost of capital (WACC)?

why did he find debt to be D/3D=1/3 and E/D=E = 2/3? where is he deriving this logic from?

Reference no: EM131347602

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