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zero coupon bond $5,000,000 0.05 Loan Amount Interest rate Bond issue 7 yr. AAA rated Number issued Price per bond Common stock Beta Shares outstanding

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zero coupon bond
$5,000,000 0.05 Loan Amount Interest rate Bond issue 7 yr. AAA rated Number issued Price per bond Common stock Beta Shares outstanding Price per share 1.40 2,000,000 $9.45 7,500 $1,010 8. 9. 10. 11. 12. 13. 14. What is the yield to maturity on the bond issue? What percentages do the loan and bond issue contribute to the firm's total debt? Find the after-tax weighted average cost of debt. What is cost of common stock? What is the market value of the common stock? What are the percentages of debt and equity in the firm's capital structure? What is the firm's weighted average cost of capital? Tax rate 30% Riskfree rate 1.6% Market rate 7.8%

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