1. The target capital structure for QM Industries is 44% common stock, 9% preferred stock, and 47% debt. If the cost of common equity for the firm is 18.2%, the cost of preferred stock is 9.8%, the before-tax cost of debt is 7.4%, and the firm's tax rate is 35%
What is QM's weighted average cost of capital?
2. Imagine that you have $10,000 to invest in either Walmart or Nike stock. Discuss which company you would invest in and also what you have based that decision on that can be found within the income statements they issue.