Problem 13-7 WACC (LO1) Examine the following book-value balance sheet for University Products Incorporated. The preferred stock currently sells for $15 per share and pays a dividend of $3 a share. The common stock sells for $20 per share and has a beta of 0.7. There are 1 million common shares outstanding. The market risk premium is 9%, the risk-free rate is 5%, and the firm's tax rate is 21%. BOOK-VALUE BALANCE SHEET Assets (Figures in $ millions). Liabilities and Net Worth Cash and short-term securities $ 3.0 Bonds, coupon = 7%, paid annually (maturity current yield to maturity = 9%) = 10 years, $ 10.0 Accounts receivable 5.0 Preferred stock (par value $20 per share) 3.0 Inventories Plant and equipment 9.0 20.0 Common stock (par value $0.10) 0.1 Additional paid-in stockholders' equity Retained earnings 16.9 7.0 Total $ 37.0 Total $ 37.0 a. What is the market debt-to-value ratio of the firm? b. What is University's WACC? Note: For all the requirements, do not round intermediate calculations. Enter your answers as a percent rounded to 2 decimal places.