Massive Inc shares have a market capitalisation of $50 billion. The company is expected to pay a dividend of $0.30 per share and each share trades for $30. The growth rate in dividends is expected to be 7% per year. Also, Massive has $15 billion of debt that trades with a yield to maturity of 8%. If the firm's tax rate is 30%, what is the WACC?
A) 7.24%
B) 7.91%
C) 6.55%
D) 7.45%
Correct Answer:
Verified
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