Jones Inc has 210000 shares of common stock outstanding at a market price of $36 a share. Last month,

Jones Inc has 210000 shares of common stock outstanding at a market price of $36 a share. Last month, Jones paid an annual dividend in the amount of $1.593 per share. The dividend growth rate is 4%. Jones also has 6000 bonds outstanding with a face value of 1000 per bond. The bonds carry 7% coupon, pay interest annually, and mature in 4.89 years. The bonds are selling at 99% if face value. The company's tax rate is 34%.

What is Jones Inc's weighted average cost of capital? SOLUTION