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2 . ( 2 4 points ) May East Enterprises has 3 2 0 , 0 0 0 shares of common stock outstanding, currently selling

2.(24 points) May East Enterprises has 320,000 shares of common stock outstanding, currently selling for \(\$ 57\) per share. The company just issued a dividend of \(\$ 4\), and the dividend is expected to grow at a constant \(4.5\%\) a year. The company also has \(8,0006.5\%\) coupon bonds outstanding, \(\$ 1,000\) par value, 25 a. What is the market value of equity? What is the market value of debt? b. What are the company's capital structure weights on a market value basis? c. Calculate the company's cost of equity and the cost of debt. d. Calculate the firm's weighted average cost of capital (WACC) based on market weights.

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