Smith Stationary Ltd needs to raise S500,000 to improve its manufacturing plant. It has 1. decided to issue a $1,000 face value bond wth a 8% annual coupon rate paid semi- annually and a 5-year maturity. The investors require 10% rate of retum. Calculate the price of this bond. How many bonds need to be issued to receive the a. required amount of fund? b. What is the firm after-taxed cost of debt given the tax rate is 30%. 2. Wagon Corporation is considering a new investment project and needs to determine WACC as a reference to project's discount rate. Currently, company has 1,000 corporate bonds and 200,000 ordinary shares outstanding. Market price of the share is $20 while corporate bonds have 10-year maturity, interest rate of 9% paid semi- annually, face value of $ 1,000 and required rate of return of 10%. Tax rate is 30%. Beta coefficient of the ordinary share is 0.95, risk free rate is 4% and market portfolio return is 15%. Calculate Wage's WACC