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A company has an optimal capital structure as follows total

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A company has an optimal capital structure as follows: total assets: $600,000, debt: $300,000, preferred stock: $100,000, common equity: $200,000. What would be the minimum expected return from a new capital investment project to satisfy the suppliers of the capital? Assume the applicable tax rate is 40%, YTM of its debts is 11%, flotation cost per share of preferred stock is $0.75, and flotation cost per share of common stock is $4. The preferred and common stocks are selling in the market for $26 and $143 a share, respectively, and they are expected to pay a dividend of $2 and $7, respectively, in one year. The company's dividends are expected to grow at 13% per year. The firm would like to maintain the foregoing optimal capital structure to finance the new project.
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