Rob wants to start his own restaurant company. He wants to finance the company using debt, preferred stocks, and common stocks. He has decided to set up his capital structure with 40% debt, 5% preferred stocks, and 55% common stocks. Market statistics: the risk-free rate is 2% and the market rate is 8%.

1. Suppose a bond pays $180 at the end of each year forever. If 8% is the relevant interest rate, what is the value of this investment to you today?

Bond Price=