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The following information relates to DTF Corporation. Eight years ago the company issued bonds with a total face value of $ 7 million. One bond
The following information relates to DTF Corporation. Eight years ago the company issued bonds with a total face value of $ million. One bond has a face value of $ The bonds have a coupon rate of pa and coupons are paid semiannually. The bonds mature in seven years from today. DTF Corporation has million ordinary shares outstanding that are currently priced at $ each and have a beta of The bonds currently yield pa the return on the stock market is pa the riskfree return is pa and the company tax rate is The company has preference shares trading at $ each.
What proportion of the firm's capital structure is preference shares?
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