Question 3 (7 Marks) Green Valley Ltd currently has the following capital structure: Debt: $2,500,000 paying 8.5% coupon bonds outstanding with an annual before-tax yield to maturity of 8% on a new issue. The bonds currently sell for $105 per $100 face value. Ordinary shares: 80,000 shares outstanding currently selling for $65 per share. The firm just paid a $7.50 dividend per share this year. The share has 3% growth rate in dividends, which it expects to continue indefinitely. The firm's marginal tax rate is 30%. Required: a) Calculate the current total market value of the firm. (2 marks) ANSWER: b) Calculate the capital structure and weighted average cost of capital (WACC) for the firm. (5 marks)