Tere company has 4.3 million shares of common stock outstanding and 85,000 bonds outstanding, par value of $1,000 each. Each bond has a 6.8 percent annual coupon rate and the bonds have 23 years to maturity and is now selling at $789.23. (Based on the current price, its YTM is 9%) Coupon is paid annually. The common stock currently sells for $58.00 per share and has a beta of 0.90. The market risk premium is 7 percent and Treasury bills are yielding 5 percent and the companys tax rate is 35 percent.

a. What are the weight of debt component (D/V) in the firms capital structure? (Round up your answer to the nearest two decimal)

b. What is the weight of equity component (E/V) in the firms capital structure? (Round up your answer to the nearest two decimal points)

c.If the company is evaluating a new investment project that has the same risk as the firms typical project, what rate should the firm use to discount the projects cash flows