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Lingenburger Cheese Corporation has 6.1 million shares of common stock outst 210,000 shares of 3.4 percent preferred stock outstanding, and 95,000 bonds semiannual coupon rate
Lingenburger Cheese Corporation has 6.1 million shares of common stock outst 210,000 shares of 3.4 percent preferred stock outstanding, and 95,000 bonds semiannual coupon rate of 5.1 percent outstanding, par value $1,000 each. The c stock currently sells for $75 per share and has a beta of 1.05 , the preferred stoc par value of \$100 and currently sells for $81 per share, and the bonds have 15 j maturity and sell for 105 percent of par. The market risk premium is 6.8 percen 1 are yielding 2.8 percent, and the company's tax rate is 21 percent. a. What is the firm's market value capital structure? (Do not round intern calculations and round your answers to 4 decimal places, e.g., .1616.) b. If the company is evaluating a new investment project that has the same risk as firm's typical project, what rate should the firm use to discount the project's cas flows? (Do not round intermediate calculations enter your answer as a percel rounded to 2 decimal places, e.g., 32.16.)
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