In period 0, a successful start-up company aggressively raises money on the capital market through a combi- nation of stock and bond issuance. In the mean time, the economy-wide risk free return is rf = 1.5% while the expected market risk premium is around E(rm)-rf = 6%. Tax rate on corporate profit is ? = 0% in this environment . Through IPO, the company issues 50,000 shares of common stocks outstanding, and these stocks are traded at Pcs-10 dollars per share. It is believed in period 0 that the investors expect a 15% return on holding this company's common st The company also issues 20,000 shares of preferred stocks traded at PS 5 dollars per share, which promises a payment of 0.5 dollars per share In period 0, the company has also auctioned off 2,000 shares of 1 0-year corporate bond at a par value of 1000. (that is Pf-1000.) The bond has a yield to maturity ( YTM) of 6%, and makes ten annual coupon payment of X dollars per share in t = 1, 2, 3, 10, In period 10, the bond holder gets par value back. In period 0, a successful start-up company aggressively raises money on the capital market through a combi- nation of stock and bond issuance. In the mean time, the economy-wide risk free return is rf = 1.5% while the expected market risk premium is around E(rm)-rf = 6%. Tax rate on corporate profit is ? = 0% in this environment . Through IPO, the company issues 50,000 shares of common stocks outstanding, and these stocks are traded at Pcs-10 dollars per share. It is believed in period 0 that the investors expect a 15% return on holding this company's common st The company also issues 20,000 shares of preferred stocks traded at PS 5 dollars per share, which promises a payment of 0.5 dollars per share In period 0, the company has also auctioned off 2,000 shares of 1 0-year corporate bond at a par value of 1000. (that is Pf-1000.) The bond has a yield to maturity ( YTM) of 6%, and makes ten annual coupon payment of X dollars per share in t = 1, 2, 3, 10, In period 10, the bond holder gets par value back