You are given the following information for Lightning Power Co. Assume the company’s tax rate is 35 percent.
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8,000 6.5 percent coupon bonds outstanding, $1,000 par value, 25 years to maturity, selling for 106 percent of par; the bonds make semiannual payments.
|Common stock:||310,000 shares outstanding, selling for $57 per share; the beta is 1.05.|
15,000 shares of 4 percent preferred stock outstanding, currently selling for $72 per share.
|Market:||7 percent market risk premium and 4.5 percent risk-free rate.|
What is the company’s WACC? (Do not round intermediate calculations and round your answer to