The floatation costs for issuing common stock , preferred stock, and debt are 4%,2% and 3% respectively. the firm plans to maintain the same capital structure.

Bluefield corporation has 6 million shared of common stock outstanding 600000 shared of preferred stock that pays an annual dividend of $8 and 200000bonds with 10% coupon and 20 years to maturity. at present the common stock is selling for $50 per share the bonds are selling for $950.62 per $1000of face value and the preferred stock is selling at $74 per share. the estimated market return is 14% the risk free rate is 8% and Bluefiels

beta is 1.4. Bluefield tax rate is 30%