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Given the following information for United Technologies Mega Corporation: Common stock: 1 million shares outstanding, $60 per share, $10 par value, beta = 1.6 Bonds:
Given the following information for United Technologies Mega Corporation: Common stock: 1 million shares outstanding, $60 per share, $10 par value, beta = 1.6 Bonds: 10,000 bonds outstanding, $1,000 face value ach, 8% annual coupon, 24 years to maturity, market price = $1,101.23 per bond Market risk premium = 8.6%, risk-free rate = 4.5%, marginal tax rate = 34% Calculate the following (rounded to 4 decimal places): Capital structure weights at market value; Cost of equity; Pre-tax and after-tax cost of debt; Weighted average cost of debt.
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