IPD is a private company considering going public to raise money for its new division. However, the company needs to know what its cost of capital would be.

As the company's chief financial officer, you consider raising the capital based on a target capital structure, as shown in the table below.

Target Capital Structure	Weight
Long-term debt	20%
Common stock equity	80%
Total	100%

IPD can raise debt by selling 20-year bonds with a $1,000 par value and a 10.0% annual coupon interest rate. IPD's corporate tax rate is 30%. Because IPD is a growing firm that requires lots of cash to grow, it does not consider paying dividends to common stockholders. As a result, you have decided to use the capital asset pricing model (CAPM) to estimate the cost of common stock. However, it would help if you calculated the beta for the company. You decided to consult the firm's investment advisors to estimate the company's beta. The investment advisor suggested using comparable companies to estimate the beta and provided Table -1 about the comparable companies. The current 20-year Treasury yield is about 4% and the market risk premium is 6%.

1. What is the beta of the company?
2. Calculate IPDs current after-tax cost of long-term debt.
3. Calculate IPDs current cost of common stock.
4. Calculate IPDs current weighted average cost capital.

List of Comparable Companies	New Process Fiber Company, Inc.	Industrial Plastic Supply, Inc.	Liberty Plastics	Applied Plastics Co., Inc.	Advanced Industrial, Inc.	Redwood Plastics and Rubber	National Plastics & Seals, Inc.	Fix Supply
Market Cap (in Billions)	5.02	2.68	2.8	2.56	6.52	1.35	5.16	9.29
Enterprise Value (in Billions)	10.55	10.09	4	3.3	6.43	2.06	4.91	7.56
Trailing P/E	4.4	43.36	22.39	16.29	4.76	548.6	5.97	6.38
Forward P/E	4.85	10.19	12.42	13.21	1.75	17.95	16.39	12.68
Price/Sales	0.2	0.16	0.59	0.54	5.77	0.39	0.76	1.85
Price/Book	1.23	0.71	1.75	1.43	4.77	1.94	3.23	14.19
Enterprise Value/Revenue	0.42	0.56	0.8	0.69	5.73	0.56	1	1.95
Enterprise Value/EBITDA	4.13	9.58	8.51	10.15	3.01	8.96	3.66	17.4
Total Debt (in Billions)	6.4	7.57	1.37	1.12	1.07	1.22	1.550	6.74
Beta (5Y Monthly)	1.5	1.6	1.5	1.3	1.39	1.48	1.3	1.2
The data of the table is gathered from different sources and websites.