Negative externalities exist in the depository sector when?

QUESTION 10 45 [CLO-2) Consider the following information for Costle Plc.: Debt: 70,000 8 percent coupon bonds outstanding with par value of $1,000 and 15 years to maturity, selling for 105 percent of par; the bonds make semiannual payments. Common stock: 375,000 shares outstanding, selling for $51 per share the beta is 1.15. Preferred stock 125,000 shares of 5.5 percent preferred stock outstanding, currently selling for $109 per share (par value-100). Market: 9 percent market risk premium and 5 percent risk-free rate. Assume the company's tax rate is 28 percent. A) Calculate the market value of each component of the capital structure (Debt, common stock and preferred stock) as well as the total market value of the firm B) Calculate the cost of equity. C) Calculate the after-tax cost of debt. D) Calculate the cost of preferred stock E) Calculate the weighted average cost of capital (WACC). TTTT Paragraph Arial T- 3 (12pt) T' T. EC HTML CSS Sx Mashups Save All Answers Clos k Save and Submit to save and submit. Click Save All Answers to save all answers. MacBook Pro a 80 F3 ODO OOO F4 F5 * $ % & 7 V 8 N co g w 6 D