Examine the following book-value balance sheet for University Products Inc. The preferred stock currently sells for $15 per share and pays a dividend of $3 a share. The common stock sells for $20 per share and has a beta of 0.8. There are 1 million common shares outstanding. The market risk premium is 12%, the risk-free rate is 8%, and the firm's tax rate is 21%.

a. What is the market debt-to-value ratio of the rm? b. What is University's WACC? [For all the requirements. do not round Intermediate calculations. Enter your answers as a percent rounded to 2 decimal places} 9 Answer is complete but not entirely correct. a. Market debt-to-value ratio 2?.51 a 9": b. WACC 14.60 a 9'3 BOOK-VALUE BALANCE SHEET (Figures in $ millions) Assets Liabilities and Net Worth Bonds, coupon = 60, paid annually Cash and short-term securities $ 2.0 (maturity = 10 years, current yield to maturity = 78) $10.0 Accounts receivable 5.0 Preferred stock (par value $10 per share) 3.0 Inventories 9.0 Common stock (par value $0. 40) 0.4 Plant and equipment 21.0 Additional paid-in stockholders' equity 14.6 Retained earnings 9.0 Total $37.0 Total $37. 0