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2 . Titan Mining Corporation has 7 . 3 million shares of common stock outstanding, 2 2 0 , 0 0 0 shares of 4
Titan Mining Corporation has million shares of common stock outstanding, shares of percent preferred stock outstanding, and percent semiannual bonds outstanding, par value $ each. The common stock currently sells for $ per share and has a beta of the preferred stock currently sells for $ per share, and the bonds have years to maturity and sell for percent of par. The market risk premium is percent, Tbills are yielding percent, and the companys tax rate is percent. a What is the firms market value capital structure? b If the company is evaluating a new investment project that has the same risk as the firms typical project, what rate should the firm use to discount the projects cash flows?
Titan Mining Corporation has million shares of common stock outstanding, shares of percent preferred stock outstanding, and percent semiannual bonds outstanding, par value $ each. The common stock currently sells for $ per share and has a beta of the preferred stock currently sells for $ per share, and the bonds have years to maturity and sell for percent of par. The market risk premium is percent, Tbills are yielding percent, and the companys tax rate is percent.
a What is the firms market value capital structure?
b If the company is evaluating a new investment project that has the same risk as the firms typical project, what rate should the firm use to discount the projects cash flows?
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