2 Price per share of Common Stock $ 45.00 3 Price per share of pereferred stock $ 60.00 4 price of bond par value (1000) $ 865.00 5 Number of shares of common stock outsanding 2,300,000 6 number of sharer of preferred stock outstanding 500,000 7 number of bonds outstanding 60,000 8 cooupon rate on bonds 5.00% 9 time remaining untill maturity of bonds 15 years 10 marginal tax rate 25.00% 11 par value of preferred stock 50 12 dividend rate on peferred stock 9.00% 13 common stock dividend (dl) 3 14 dividend growth rate (common) 6.00% 15 Risk - free rate 0 16 Beta 1.20% 17 expected return on the market 12.00% 18 risk premium on stocks over bonds 4.50% 19 20 21 4. Calculate the cost of Preferred Stock 22 5. Calculate the cost of Common Stock using the 1. Dividend Valuation Approach, 2. Security Market Line, and 3. Bond Yield + Bond Premium. Take the average of these three methods. 23 6.Find the Marginal Cost of Capital (MCC) 24 7.. Check for calculation errors if the MCC isn't 9.44% or 9.45% 25 26