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The price per unit of RMM's debt is $93.45 and there are 4000 units of debt. The price per unit of common stock is $50

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The price per unit of RMM's debt is $93.45 and there are 4000 units of debt. The price per unit of common stock is $50 and there are 10,000 units of common stock. The debt has a face value of $100, 10% coupon rate, and 10 years to maturity. The common stock has a beta of 1.85; the S&P500 has a return of 12.5% and the T-bill rate is 3.5%. The corporate tax rate is 30%. (1) Determine the cost of common stock, and the cost of debt. (2) What is the capital structure of RMM? (How much of the capital is raised by issuing common stock and debt, respectively?) (8) Determine the weighted average cost of capital

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