Green Mountain Ltd. currently has the following capital structure:

Debt funding: An outstanding bond with face value of $1, 000, paying annually 9.5% coupon rate with an annual before-tax yield to maturity of 9%. The bond issue has total book value of $2,500,000 and will mature in 15 years.

Ordinary equity funding: Totally 60,000 outstanding shares, paying a constant growing dividend rate of 3% annually. The firm just paid a $2.50 dividend per share in the current financial year.

Hybrid funding: Totally 55,000 outstanding preferred shares with face value of $100, paying fixed dividend rate of 14.5%.

Company tax rate is 30%.

Required: Complete the following tasks:

1. Calculate the current price of the corporate bond?
2. Calculate the current price of the ordinary share if the average return of the shares in the same industry is 11.5%?
3. Calculate the current value of the preferred share if the average return of the shares in the same industry is 10.5%
4. Calculate the current market value (rounded off to the nearest whole number) and capital structure of the firm (rounded off to two decimal places).
5. Compute the weighted average cost of capital (WACC) under the traditional tax system for the firm