Filer Manufacturing has 8.3 million shares of common stock outstanding. The current share price is $53, and the book value per share is $4. Filer Manufacturing also has two bond issues outstanding. The first bond issue has a face value of $70 million and a coupon rate of 7 percent and sells for 108.3 percent of par. The second issue has a face value of $60 million and a coupon rate of 7.5 percent and sells for 108.9 percent of par. The first issue matures in 8 years, the second in 27 years.

a.Compute and discuss Filer's capital structure weights on a book value basis.

b. Compute and anlyse Filer's capital structure weights on a market value basis.

c. Determine either the book or market value weights is more relevant.