Suppose Mullens Corporation is considering three average-risk projects with the following costs and rates of return: Mullens estimates that it can issue debt at a rate of rd=10.00% and a tax rate of T=20.00%. It can issue preferred stock that pays a constant dividend of Dp=$20.00 per year and at Pp=$200.00 per share. Also, its common stock currently sells for P0=$19.00 per share. The expected dividend payment of the common stock is D1=$4.75 and the dividend is expected to grow at a constant annual rate of g=5.00% per year. Mullens' target capital structure consists of wd=70.00% common stock, wd=20.00% debt, and wp=10.00% preferred stock. According to the video, the after-tax cost of debt can be stated as Plugging in the values for rd and (T) yields an after-tax cost of debt of approximately According to the video, the cost of preferred stock can be stated as Plugging in the values for Dp and Pp yields a cost of preferred stock of of approximately Hint: Assume no flotation costs. According to the video, the cost of common stock can be stated as Plugging in the values for D1,P0, and g yields a cost of common stock of approximately Hint: Assume no flotation costs. According to the video, the cost of common stock can be stated as Plugging in the values for D1,P0, and g yields a cost of common stock of approximately Recall that the equation for the weighted average cost of capital (WAAC) can be stated as: WAAC=(%ofdebs)(After-taxcostofdebr)+(%ofpreferredstock)(Costofpreferredstock)+(%ofCommonequity)(Costofcommonequity) Plugging in the relevant values into the formula for WACC yields a WAAC of approximately Suppose that Mullens will only accept projects with an expected rate of return that exceeds the WAAC. Which of the following projects will Mullens accept? Check all that apply. Project 1 Project 2 Project 3 Mullens estimates that it can issue debt at a rate of rd=10.00% and a tax rate of T=20.00%. It can issue preferred stock that pays a constant dividend of Dp=$20.00 per year and at Pp=$200.00 per share. Also, its common stock currently sells for P0=$19.00 per share. The expected dividend payment of the common stock is D1=$4.75 and the dividend is expected to grow at a constant annual rate of g=5.00% per year. Muliens' target capital structure consists of ws=70.00% common stock, w1=20.00% debt, and wp=10.00% preferred stock. According to the video, the after-tax cost of debt can be stated as debt of approximately According to the video, the cost of preferred stock can be stated as rd(1T). Plugging in the values for Dp and Pp yields a cost of preferred stock of of approximately Hint: Assume no flotation costs. According to the video, the cost of common stock can be stated as common stock of approximately dividend of Dp=$20.00 per year and at Pp=$200.00 per share. Also, its common stock currently sells for P0=$19.00 per share. The expected dividend payment of the common stock is D1=$4.75 and the dividend is expected to grow at a constant annual rate of g=5.00% per year. Mullens' target capital structure consists of wf=70.00% common stock, wd=20.00% debt, and wp=10.00% preferred stock. According to the video, the after-tax cost of debt call be stated as . Plugging in the values for rd and (T) yields an after-tax cost of debt of approximately Recall that the equation for the weighted average cost of capital (WAAC) can be stated as: WAAC=(%ofdebi)(Aftertaxcostofdebi)+(%ofpreferredstock)(Costofpreferredstock)+(%ofCommonequity)(Costofcommonequity) Also, its common stock currently sells for P0=$19.00 per share. The expected dividend payment of the common stock is D1=34.13 and one dividend is expected to grow at a constant annual rate of g=5.00% per year. Mullens' target capital structure consists of wz=70.00% common stock, wd=20.00% debt, and wp=10.00%, preferred stock. According to the video, the aftertax cost of debt can be stated as Pluging in the values for rd and (T) yields an after-tax cost of debt of approximately According to the video, the cost of preferred stock can be stated as Plugging in the values for Dp and Pp yields a cost of preferred stock of of approximately Hint: Assume no flotation costs: According to the video, the cost of a common stock of approximately fecall that the equation for the weighted average cost of capital (WAAC) can be stated as: WAAC=(% of debi )( After ax cost of debt) dividend of Dp=$20.00 per year and at Pp=$200.00 per share. Also, its common stock currently sells for P0=$19.00 per share. The expected dividend payment of the common stock is D1=$4.75 and the dividend is expected to grow at a constant annual rate of g=5.00% per year. Mullens' target capital structure consists of wy=70.00% common stock, wd=20.00% debt, and wp=10.00% preferred stock. According to the video, the after-tax cost of debt can be stated as Plugging in the values for rd and (T) yields an after-tax cost of debt of approximately According to the video, the cost of preferred stock can be stated as . Plugging in the values for Dp and Pp yieids a cost of preferred stock of of approximately WAAC=(%ofdebr)(Aftertaxcostofdebr)+(%ofpnferredstock)(Costofpreferredstodk)+(%ofCommonequiry)(Castofcommonequity) dividend is expected to grow at a constant annual rate of g=5.00% per year. Mullens' target capital structure consists of ws=70.00% common stock, wd=20.00% debt, and wp=10.00% preferred stock. According to the video, the after-tax cost of debt can be stated as Plugging in the values for rd and (T) yields an after-tax cost of debt of approximately According to the video, the cost of preferred stock can be stated as Plugging in the values for Dp and Pp yields a cost of preferred stock of of approximately Hint: Assume no flotation costs. According to the video, the cost of common stock can be stated as . Plugging in the values for D1,P0, and g yields a cost of common stock of approximately Muliens' target capital structure consists of wd=70.00% common stock, wd=20.00% debt, and wp=10.00% preferred stock. Plugging in the values for ri and (T) vields an after-tax cost of According to the video, the after-tax cost of debt can be stated as debt of approximately According to the video, the cost of preferred stock can be stated as Plugging in the values for Dp and Pf yields a cost of preferred stock of of approximately Hint: Assume no flotation costs. According to the video, the cost of common stock can be stated as . Plugging in the values for D1,P0, and g vields a cost of common stock of approximately Recall that the equation for the w WAAC=(%ofdebr)(Afte.00%+(%ofpreferredstock)(Costofpreferredstock)+(%ofCommonequity)(Costofcommonequity) Plugging in the relevant values into the formula for WACC yields a WAAC of approximately Plugging in the relevant values into the formula for WACC yields a WAAC of approximately Suppose that Mullens will only accept projects with an expected rate of return that exceed Which of the following projects will Mullens accept? Check all that apply. Project 1 Project 2 Project 3