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Business, 04.06.2020 01:58 angie249

The market value of Fords' equity, preferred stock and debt are $ 6 billion, $ 2 billion, and $ 12 billion, respectively. Ford has a beta of 1.8, the market risk premium is 8%, and the risk-free rate of interest is 4%. Ford's preferred stock pays a dividend of $ 2.50 each year and trades at a price of $ 25 per share. Ford's debt trades with a yield to maturity of 10%. What is Ford's weighted average cost of capital if its tax rate is 40%?

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The market value of Fords' equity, preferred stock and debt are $ 6 billion, $ 2 billion, and $ 12 b...
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