1. Kim's Bridal Shoppe has 11,900 shares of common stock outstanding at a price of $53 per share. It also has 300 shares of preferred stock outstanding at a price of $93 per share. There are 350 bonds outstanding that have a coupon rate of 7.2 percent paid semiannually. The bonds mature in 34 years, have a face value of $2,000, and sell at 110.5 percent of par. What is the capital structure weight of the common stock? .
2. Piedmont Hotels is an all-equity company. Its stock has a beta of .83. The market risk premium is 7.0 percent and the risk-free rate is 4.4 percent. The company is considering a project that it considers riskier than its current operations so it wants to apply an adjustment of 1.8 percent to the project's discount rate. What should the firm set as the required rate of return for the project? 8.41% 10.21% 12.01% 6.56% 8.36%