The capital structure of a company is composed of debt and equity as follows. Given the following information, what is the approximate weight of debt in the capital structure? The tax rate is 30%. # of outstanding shares Stock price (each) Expected dividend per share Dividend growth rate # of outstanding bonds Coupon rate Bond price (each) Years to maturity (payment is annually) Equity Debt 50,000 $100 $2 5% 4,000 5% $950 7

The capital structure of a company is composed of debt and equity as follows. Given the following information, what is the approximate weight of debt in the capital structure? The tax rate is \30