Clearview Systems Ltd. Suppose you have been hired as a financial consultant to Clearview Systems Ltd., a large, publicly traded firme the market share leader in radon detection systems (RDS). The company is looking at setting up a manufacture plant overseas to produce a new line of RDSs. The project will require an investment of $6.0 million dollars and the president of the company wants to be sure she understands her cost of capital before going ahead with the decision. Market information for the latest year-end (December 31/2020) is as follows: Debt The company has issued 17,100 bonds, each with a par value of $1,000 and a coupon rate of 6.00 percent (payable semi-annually). The bonds were issued 10 years ago with a 20 year maturity. They are currently selling for $999.00 each. Preferred Stock 134,000 preferred shares have been authorized (with 127,000 issued and outstanding). The closing price of preferred shares was $59.00 per share. Common Equity 365,000 common shares have been authorized (with 347,000 shares issued and outstanding). Common shares are selling for $68.00 per share. Clearview Systems Ltd. uses G. M. Wharton as its lead underwriter. Wharton charges 4.00 percent commission on new common stock issues, 3.00 percent on new preferred stock issues, and 4.00 percent on new debt issues. Wharton has included all direct and indirect flotation costs in these rates. The preferred shares were issued six years ago and pay an annual dividend of $1.77 per share. Last year, Clearview Systems Ltd. declared and paid a common share dividend of $1.87 per share. This represented a 6.00 percent growth in the common share dividend (a rate that is expected to continue into the future) and a dividend payout ratio of 40.0 percent (also expected to continue into the future). Clearview Systems Ltd.'s tax rate is 30.0 percent. Preliminary year-end results show net earnings (after interest, taxes and preferred share dividends) for the year ending December 31, 2020 is $6.0 million. Clearview Systems Ltd. Suppose you have been hired as a financial consultant to Clearview Systems Ltd., a large, publicly traded firme the market share leader in radon detection systems (RDS). The company is looking at setting up a manufacture plant overseas to produce a new line of RDSs. The project will require an investment of $6.0 million dollars and the president of the company wants to be sure she understands her cost of capital before going ahead with the decision. Market information for the latest year-end (December 31/2020) is as follows: Debt The company has issued 17,100 bonds, each with a par value of $1,000 and a coupon rate of 6.00 percent (payable semi-annually). The bonds were issued 10 years ago with a 20 year maturity. They are currently selling for $999.00 each. Preferred Stock 134,000 preferred shares have been authorized (with 127,000 issued and outstanding). The closing price of preferred shares was $59.00 per share. Common Equity 365,000 common shares have been authorized (with 347,000 shares issued and outstanding). Common shares are selling for $68.00 per share. Clearview Systems Ltd. uses G. M. Wharton as its lead underwriter. Wharton charges 4.00 percent commission on new common stock issues, 3.00 percent on new preferred stock issues, and 4.00 percent on new debt issues. Wharton has included all direct and indirect flotation costs in these rates. The preferred shares were issued six years ago and pay an annual dividend of $1.77 per share. Last year, Clearview Systems Ltd. declared and paid a common share dividend of $1.87 per share. This represented a 6.00 percent growth in the common share dividend (a rate that is expected to continue into the future) and a dividend payout ratio of 40.0 percent (also expected to continue into the future). Clearview Systems Ltd.'s tax rate is 30.0 percent. Preliminary year-end results show net earnings (after interest, taxes and preferred share dividends) for the year ending December 31, 2020 is $6.0 million