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Use the following information to answer questions 19 through 24. A corporation has 10,000 bonds outstanding with a 6% annual coupon rate, 8 years to

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Use the following information to answer questions 19 through 24. A corporation has 10,000 bonds outstanding with a 6% annual coupon rate, 8 years to maturity, a $1,000 face value, and a $1,100 market price. The company's 500,000 shares of common stock sell for $25 per share, have a beta of 1.5 , the risk-free rate is 4%, and the market return is 12%. 19. What is the market value of equity for this corporation? A. $5 million B. $11 million C. $12.5 million D. $4 billion E. none of the above 20. What is the market valuc of debt for this corporation? A. $10 million B. $11 million C. \$1 billion D. \$1.1 bilion E. none of the above 21. What is the cost of equity for this corporation? A. 6% B. 12% C. 16% D. 22% E. none of the above 22. What is the pre-tax cost of debt for this corporation? A. 2.69%6 B. 4.48% C. 6.00% D. 8.97% E. none of the above 23. Assuming a 40% tax rate, what is this corporation's after-tax cost of debt? A. 2.69% B. 4.48% C. 6.00% D. 8.97% B. none of the above 24. What is the weighted average cost of capital for this company? A. 9.34% B. 9.77% C. 1024% D. 10.61% Use the following information to answer questions 19 through 24. A corporation has 10,000 bonds outstanding with a 6% annual coupon rate, 8 years to maturity, a $1,000 face value, and a $1,100 market price. The company's 500,000 shares of common stock sell for $25 per share, have a beta of 1.5 , the risk-free rate is 4%, and the market return is 12%. 19. What is the market value of equity for this corporation? A. $5 million B. $11 million C. $12.5 million D. $4 billion E. none of the above 20. What is the market valuc of debt for this corporation? A. $10 million B. $11 million C. \$1 billion D. \$1.1 bilion E. none of the above 21. What is the cost of equity for this corporation? A. 6% B. 12% C. 16% D. 22% E. none of the above 22. What is the pre-tax cost of debt for this corporation? A. 2.69%6 B. 4.48% C. 6.00% D. 8.97% E. none of the above 23. Assuming a 40% tax rate, what is this corporation's after-tax cost of debt? A. 2.69% B. 4.48% C. 6.00% D. 8.97% B. none of the above 24. What is the weighted average cost of capital for this company? A. 9.34% B. 9.77% C. 1024% D. 10.61%

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