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Homework answers / question archive / Given the following information for Pomona Power Co
Given the following information for Pomona Power Co., what is the WACC? Assume a tax rate of 21.0%. DEBT: 10,000 bonds outstanding that have a coupon rate of 6.5%, a $1,000 or value, with 26 years to maturity, selling for 109 percent of par, and makes semiannual payments. Common Stock: 495,000 shares outstanding that currently sell for $64.00 per share. Their beta is 1.17. The Market: The current market risk premium is assumed the be 7.0% and the risk-free rate is 3.2%.
