Suppose the Churchill company has this book value balance sheet: The current liabilities consist entirely of notes

Question:

Suppose the Churchill company has this book value balance sheet:

The current liabilities consist entirely of notes payable to banks, and the interest rate on this debt is 4%, the same as the rate on new bank loans. The long-term debt consists of 47,000 bonds, each of which has a par value of $1,000, carries an annual coupon interest rate of 9%, and matures in 20 years. The going rate of interest on new long-term debt, rd, is 6%, and this is the present yield to maturity on the bonds. The common stock sells at a price of $75 per share. Assume a zero tax rate. Calculate the firm's market value capital structure?

Coupon
A coupon or coupon payment is the annual interest rate paid on a bond, expressed as a percentage of the face value and paid from issue date until maturity. Coupons are usually referred to in terms of the coupon rate (the sum of coupons paid in a... Maturity
Maturity is the date on which the life of a transaction or financial instrument ends, after which it must either be renewed, or it will cease to exist. The term is commonly used for deposits, foreign exchange spot, and forward transactions, interest... Par Value
Par value is the face value of a bond. Par value is important for a bond or fixed-income instrument because it determines its maturity value as well as the dollar value of coupon payments. The market price of a bond may be above or below par,...