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Doubled Ltd has 4.2 million ordinary shares on issue trading at $5.56, and 750,000 preference shares on issue trading at $7.39. Doubled Ltd is a

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Doubled Ltd has 4.2 million ordinary shares on issue trading at $5.56, and 750,000 preference shares on issue trading at $7.39. Doubled Ltd is a dividend-paying company. The growth rate in ordinary dividends is 3%, and the company has just paid an ordinary dividend of $0.55 per share. The preference shares pay a constant dividend of $1.00 per share. The market risk premium is 7% and the risk-free rate is 7%. Doubled Ltd is a levered company with 150,000 $1000 par value bonds on issue, which will mature in 4 years. The coupon rate on Doubled's debt is 8% paid semi-annually and are currently trading at $1152.36. The corporate tax rate is 30%. a. Calculate the capital structure weights (1 mark) Click or tap here to enter text. b. Calculate the cost of equity (1 mark) Click or tap here to enter text. c. Calculate the cost of the preference shares (1 mark) Click or tap here to enter text. d. Calculate the cost of debt (2 marks)

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