Company XXX has a marginal tax rate of 40%.

The firm may issue new bonds at par that would provide a YTM of 8.5%.

The firm's beta is 0.7, the treasury bill rate is 5%, and the market return is 12%.

The company's long-term debt is currently selling at face value of $3,000.

The company has 100 shares of common stock outstanding that are selling for $10 per share.

Based on the information above:

1) What is XXX's capital structure based on market weights?

2) What is the firm's weighted average cost of capital?