Filer Mining Corporation has eight million shares of common stock outstanding, 400,000 shares of 4 percent preferred stock outstanding, and 150,000 7 percent semiannual bonds outstanding, par value $1,000 each. The common stock currently sells for $45 per share and has a beta of 0.90, the preferred stock currently sells for $70 per share, and the bonds have 15 years to maturity and sell for 90 percent of par. The market risk premium is 9 percent, the risk-free rate is 5 percent, and Filer Minings tax rate is 34 percent.

a. What are the firms market value capital structure weights?

b. If Filer Mining is evaluating a new investment project that has the same risk as the firms typical project, what rate should the firm use to discount the projects cash flows? (The YTM on the debt is either 6.17% or 8.17%).