20.00 PU Organic Produce Corporation has 8.9 million shares of common stock outstanding, 640,000 shares of preferred stock outstanding, and 189,000 of 8.6 percent semiannual bonds outstanding, par value $1,000 each. The common stock currently sells for $65.40 per share and has a beta of 1.34, the preferred stock has a dividend that's 7.4 percent of the face value $100 but currently sells for $106.60 per share, and the bonds have 13 years to maturity and sell for 89 percent of par. The market risk premium is 7 percent, T-bills are yielding 5.7 percent, and the firm's tax rate is 35 percent. Required: (a) What are the firm's market value weights of its capital structure? Provide three decimal numbers that should sum to 1. (Do not round intermediate calculations. Round your answers to 4 decimal places (e.g., 0.1616).) Market value weight of debt Market value weight of preferred stock Market value weight of equity (b) If the firm is evaluating a new investment project that has the same risk as the firm's typical project, what rate should the firm use to discount the project's cash flows? Hint: WACC is the rate to be used as the discount rate in new project evaluation. (Do not round Intermediate calculations. Enter your answer as a percentage rounded to 2 decimal places (e.g., 32.16).) Weighted average cost of capital % References eBook & Resources