S & P Corporation (SPC) has an optimal capital structure of 40 pe Given the following information, calculate the marginal cost of capital (MCC) schedule and the capital budget (eg. how much is the optimal capital budget and what is the corporate rcent debt and 60 percent equity. cost of ca 5 years ago, the company issued callable bonds that pay semiannual payment with 6.50% annual coupon rate and sold them at par value ($1,000). However, each bond is currently selling at 960 and has 25 years remaining to maturity SPC's current stock price is$55.94, its long run growth rate is 4.0% and its expected earnings per share (EPS) is $5.0. Thecompanyretains 20%ofits earningstofundfutureerowth . . There are 102.5 million common shares outstanding .New common stock may be issued with 5 percent flotation costs. . The marginal tax rate is 26%. . SPC has the following Investment Opportunity Schedule (IOS): Project IRR Cost (millions) 15.2% 12.5% 9.0% 7.5% 6.0% 20 45 40 S & P Corporation (SPC) has an optimal capital structure of 40 pe Given the following information, calculate the marginal cost of capital (MCC) schedule and the capital budget (eg. how much is the optimal capital budget and what is the corporate rcent debt and 60 percent equity. cost of ca 5 years ago, the company issued callable bonds that pay semiannual payment with 6.50% annual coupon rate and sold them at par value ($1,000). However, each bond is currently selling at 960 and has 25 years remaining to maturity SPC's current stock price is$55.94, its long run growth rate is 4.0% and its expected earnings per share (EPS) is $5.0. Thecompanyretains 20%ofits earningstofundfutureerowth . . There are 102.5 million common shares outstanding .New common stock may be issued with 5 percent flotation costs. . The marginal tax rate is 26%. . SPC has the following Investment Opportunity Schedule (IOS): Project IRR Cost (millions) 15.2% 12.5% 9.0% 7.5% 6.0% 20 45 40