1. PDQ, Inc., expects EBIT to be approximately $11.8 million per year for the foreseeable future, and it has 100,000 20-year, 7 percent annual coupon bonds outstanding. (Use Table 11.1)

What would the appropriate tax rate be for use in the calculation of the debt component of PDQs WACC? (Round your answer to 2 decimal places.)

Tax rate

%

2. FarCry Industries, a maker of telecommunications equipment, has 6 million shares of common stock outstanding, 4 million shares of preferred stock outstanding, and 45,000 bonds. Suppose the common shares sell for $29 per share, the preferred shares sell for $15.50 per share, and the bonds sell for 99 percent of par.

What weight should you use for preferred stock in the computation of FarCrys WACC? (Round your answer to 2 decimal places.)

Weight used

%

3. Suppose that MNINK Industries capital structure features 65 percent equity, 6 percent preferred stock, and 29 percent debt. Assume the before-tax component costs of equity, preferred stock, and debt are 11.80 percent, 9.70 percent, and 9.00 percent, respectively.

What is MNINKs WACC if the firm faces an average tax rate of 34 percent? (Round your answer to 2 decimal places.)

WACC

%

4. BetterPie Industries has 3 million shares of common stock outstanding, 2 million shares of preferred stock outstanding, and 10,000 bonds. Assume the common shares are selling for $45 per share, the preferred shares are selling for $22.50 per share, and the bonds are selling for 98 percent of par.

What would be the weights used in the calculation of BetterPies WACC? (Do not round intermediate calculations. Round your final answer to 2 decimal places.)

Equity weight	%
Preferred stock weight	%
Debt weight	%

5. WhackAmOle has 4 million shares of common stock outstanding, 3.0 million shares of preferred stock outstanding, and 95,000 bonds. Assume the common shares are selling for $62 per share, the preferred shares are selling for $51.00 per share, and the bonds are selling for 105 percent of par.

What would be the weights used in the calculation of WhackAmOles WACC? (Do not round intermediate calculations. Round your final answer to 2 decimal places.)

Equity weight	%
Preferred stock weight	%
Debt weight	%