Bunkhouse Electronics is a recently incorporated firm that makes electronic entertainment systems. Its earnings and dividends have been growing at a rate of 33.0%, and the current dividend yleld is 5.00%. Its beta is 1.26 , the market risk premium is 11.00%, and the risk-free rate is 3.40%. a. Use the CAPM to estimate the firm's cost of equity. Note: Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places. b. Now use the constant growth model to estimate the cost of equity. Note: Do not round intermedlate calculations. Enter your answer as a whole percent. c. Which of the two estimates is more reasonable? Micro Spinoffs incorporated issued 10-year debt a year ago at par value with a coupon rate of 8%, paid annually. Today, the debt is selling at $1,160. If the firm's tax bracket is 21%, what is its percentage cost of debt? Assume a face value of $1,000. Note: Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places. su need to estimate the value of Laputa Avlation. You have the following forecasts (in millions of dollars) of its profits and of its future vestments in new plant and working capital: From year 5 onward, EerTDA, depreciation, and investment are expected to remain unchanged ot year-4 levels. Laputa is financed 40% by equity and 60% by debt its cost of equity is 13%, its debt yleids 9%, and it pays corporate tax at 30%. a. Estimate the company's total value. Note: Do not round intermediate calculations. Enter your answer in millions rounded to the nearest whole amount. b. What is the value of Laputa's equily? Note: Do not round intermediate calculations. Enter your answer in millions rounded to the nearest whole amount. Bunkhouse Electronics is a recently incorporated firm that makes electronic entertainment systems. Its earnings and dividends have been growing at a rate of 33.0%, and the current dividend yleld is 5.00%. Its beta is 1.26 , the market risk premium is 11.00%, and the risk-free rate is 3.40%. a. Use the CAPM to estimate the firm's cost of equity. Note: Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places. b. Now use the constant growth model to estimate the cost of equity. Note: Do not round intermedlate calculations. Enter your answer as a whole percent. c. Which of the two estimates is more reasonable? Micro Spinoffs incorporated issued 10-year debt a year ago at par value with a coupon rate of 8%, paid annually. Today, the debt is selling at $1,160. If the firm's tax bracket is 21%, what is its percentage cost of debt? Assume a face value of $1,000. Note: Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places. su need to estimate the value of Laputa Avlation. You have the following forecasts (in millions of dollars) of its profits and of its future vestments in new plant and working capital: From year 5 onward, EerTDA, depreciation, and investment are expected to remain unchanged ot year-4 levels. Laputa is financed 40% by equity and 60% by debt its cost of equity is 13%, its debt yleids 9%, and it pays corporate tax at 30%. a. Estimate the company's total value. Note: Do not round intermediate calculations. Enter your answer in millions rounded to the nearest whole amount. b. What is the value of Laputa's equily? Note: Do not round intermediate calculations. Enter your answer in millions rounded to the nearest whole amount