Greene Co. is planning a project for which it will issue new bonds. Bonds in the same risk class and with the same covenants, issued by another firm are currently priced at $954.90, have 25 years remaining to maturity, and pay coupons of $100 yearly, made in semi-annual payments. If Greene's marginal tax rate is 34.50%, it's cost of equity is 12.00% with an equity value of $23,000,000.00, and they have 15,000 bonds with a par value of $1,000.00 what is the WACC of this project? 21.03% 10.04% 10.51% 12.70%
Greene Co. is planning a project for which it will issue new bonds. Bonds in the same risk class and with the same covenants, issued by another firm are currently priced at $954.90, have 25 years remaining to maturity, and pay coupons of $100 yearly, made in semi-annual payments. If Greene's marginal tax rate is 34.50%, it's cost of equity is 12.00% with an equity value of $23,000,000.00, and they have 15,000 bonds with a par value of $1,000.00 what is the WACC of this project? 21.03% 10.04% 10.51% 12.70%
Essentials Of Investments
11th Edition
ISBN:9781260013924
Author:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Publisher:Bodie, Zvi, Kane, Alex, MARCUS, Alan J.
Chapter1: Investments: Background And Issues
Section: Chapter Questions
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Bhupatbhai

Transcribed Image Text:Greene Co. is planning a project for which it will issue new bonds. Bonds in the same
risk class and with the same covenants, issued by another firm are currently priced at
$954.90, have 25 years remaining to maturity, and pay coupons of $100 yearly,
made in semi-annual payments. If Greene's marginal tax rate is 34.50%, it's cost of
equity is 12.00% with an equity value of $23,000,000.00, and they have 15,000
bonds with a par value of $1,000.00 what is the WACC of this project?
21.03%
10.04%
10.51%
12.70%
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