Question

Consider the following information for Evenflow Power Co.,

Debt:		4,500 7.5percent coupon bonds outstanding, $1,000 par value, 21 years tomaturity, selling for 105 percent of par; the bonds make semiannualpayments.
Common stock:		99,000 sharesoutstanding, selling for $60 per share; the beta is 1.07.
Preferred stock:		13,000 shares of7 percent preferred stock outstanding, currently selling for $107per share.
Market:		9 percent marketrisk premium and 6.5 percent risk-free rate.

Assume thecompany's tax rate is 34 percent.

Required:

Find the WACC