The three parts of this question all refer to the same information as follows. A firm has $20M outstanding in preference shares, S50M in ordinary shares, and $30M in bonds. The preference shares were issued at $8.00 par per share and pay a constant annual dividend of $1 per share. They are currently trading at $9.00. The firm has a beta of 12. The expected market return is 10 per cent per annum and the risk-free rate is 2 per cent per annum. The bonds were issued at an initial yield of 6 per cent per annum effective but today they are yielding 5 per cent per annum effective. The tax on interest is 30 per cent. There are no other taxes. Determine (a) The cost of capital of the preference shares The three parts of this question all refer to the same information as follows. A firm has $20M outstanding in preference shares. $50M in ordinary shares, and $30M in bonds. The preference shares were issued at $8.00 par per share and pay a constant annual dividend of $1 per share. They are currently trading at $9.00. The firm has a beta of 12. The expected market return is 10 per cent per annum and the risk-free rate is 2 per cent per annum. The bonds were issued at an initial yield of 6 per cent per annum effective but today they are yielding 5 per cent per annum effective. The tax on interest is 30 per cent. There are no other taxes. Determine: (1) The cost of capital of the ordinary shares The three parts of this question al refer to the same information as follows A firm has $20M outstanding in preference shares SSOM in ordinary shares, and $30M in bonds. The preference shares were issued at $8.00 par per share and pay a constant annual dividend of $1 per share. They are currently trading at $9.00. The firm has a beta of 12. The expected market return is 10 per cent per annum and the risk-free rate is 2 per cent per annum. The bonds were issued at an initial yield of 6 per cent per annum effective but today they are yielding 5 per cent per annum effective. The tax on interest is 30 per cent. There are no other taxes. Determine (C) The cost of capital of the bonds