PART PARTS TO THIS QUESTION

Dani Corporation has 5 million shares of common stock outstanding. The current share price is $77, and the book value per share is $8. The company also has two bond issues outstanding. The first bond issue has a face value of $110 million, a coupon rate of 6 percent, and sells for 94 percent of par. The second issue has a face value of $95 million, a coupon rate of 5 percent, and sells for 106 percent of par. The first issue matures in 20 years, the second in 9 years. Both bonds make semiannual coupon payments.

(A)

a. Equity/Value:

a. Debt/Value:

a.	What are the company's capital structure weights on a book value basis? (Do not round intermediate calculations and round your answers to 4 decimal places, e.g., .1616.)
b.	What are the companys capital structure weights on a market value basis? (Do not round intermediate calculations and round your answers to 4 decimal places, e.g., .1616.)

b. Equity/Value:

b. Debt/Value:

(B)

a. Equity/Value:
a. Debt/Value:
b. Equity/Value:
b. Debt/Value:

(C)

c.	Which are more relevant, the book or market value weights?
	multiple choice Market value Book value