Blues Cruises issues only common stock and fixed-coupon bonds. Blues has 850,000 shares outstanding with a market price of $3.70 per share at a current cost of 11.25 percent (according to the SML) and $2 million par value of bond outstanding that currently trade at 98% of par at a pretax cost of 6.25 percent. The firm's tax rate is 28 percent? What is the capital structure weight of the firm's equity?

Answer rating: 100% (QA)

To calculate the capital structure weight of the firms equity we need to determine the total m... View the full answer