Power Financial Corp Has a Current Share Price of $30,and

question 100

Multiple Choice

Power Financial Corp has a current share price of $30,and a market capitalization of $20 billion.The firm's beta is 0.93,the risk-free rate is 3.2%,and the market risk premium is 7%.The firm has $12 billion of debt with a yield to maturity of 5%.If the firm's tax rate is 20%,what is Power Financial's WACC?

• A)5.43%
• B)5.71%
• C)7.94%
• D)6.55%
• E)7.57%

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Definitions:

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