JAK Industries Has 5 Million Shares of Stock Outstanding Selling

question 11

Multiple Choice

JAK Industries has 5 million shares of stock outstanding selling at $25 per share and an issue of $40 million in 8 percent, annual coupon bonds with a maturity of 15 years, selling at 108 percent of par ($1000) . If JAK's weighted average tax rate is 34 percent and its cost of equity is 15 percent, what is JAK's WACC?

• A)9.19 percent
• B)12.36 percent
• C)12.50 percent
• D)12.98 percent

---

Definitions:

Project Management

The practice of initiating, planning, executing, controlling, and closing the work of a team to achieve specific goals and meet specific success criteria.

Web App

A program situated on an external server, reachable and utilized through a web browser interface over the Internet.

Electronic Document

A digital form of a document that can be created, viewed, edited, stored, and transmitted electronically, often in formats like PDF or DOC.

Webpage

A hypertext document connected to the World Wide Web that can display text, images, audio, video, and other multimedia elements.