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Organic Produce Corporation has 8 million shares of common stock outstanding, 550,000 shares of 7 percent preferred stock outstanding, and 180,000 of 8.2 percent semiannual

Organic Produce Corporation has 8 million shares of common stock outstanding, 550,000 shares of 7 percent preferred stock outstanding, and 180,000 of 8.2 percent semiannual bonds outstanding, par value $1,000 each. The common stock currently sells for $64.50 per share and has a beta of 1.25, the preferred stock currently sells for $107.50 per share, and the bonds have 15 years to maturity and sell for 93.5 percent of par. The market risk premium is 6.8 percent, T-bills are yielding 5.5 percent, and the firms tax rate is 34 percent. Required: (a) What is the firm's market value capital structure? (Do not round intermediate calculations. Round your answers to 4 decimal places (e.g., 32.1616).) Market value weight of debt Market value weight of preferred stock Market value weight of equity (b) If the firm is evaluating a new investment project that has the same risk as the firms typical project, what rate should the firm use to discount the projects cash flows?

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