Question
6) Sam's Train Shoppe has 15,000 shares of common stock outstanding at a price of $20.96 a share. It also has 1839 shares of preferred
6)Sam's Train Shoppe has 15,000 shares of common stock outstanding at a price of $20.96 a share. It also has 1839 shares of preferred stock outstanding at a price of $43.72 a share. There are 50 bonds outstanding that sell at 96 percent of the $1000 par value. What is the capital structure weight of the preferred stock? Input your answer as a decimal rounded to four places.
7)Firm Why has a capital structure based on market values of 30 percent debt and the rest common equity.You know that the coupon rate on the debt is 8 percent and the yield to maturity on the debt is 10 percent.You also know that the common equity beta is 1.83, the market risk premium is 5.5 percent and the risk-free rate is 2 percent, and the tax rate is 40 percent.Find Firm Why's WACC
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