Lippo In. reports the following capital structure on its balance sheet: Debt $ 20 m, Preferred stock $ 10 m, Common stock $ 20 m The debt has 10 years to maturity, carries a coupon rate of 6%, and sells at 86.58% of face value. The preferred shares have a face value of $100 each and pay an annual dividend of $11. They sell at $105 each. There are 1 million shares of common stock with a market price of $30 each. The stock has a beta of 1.2. The risk-free rate is 5%. Assume that the risk premium on the market portfolio is 6%. The tax rate is 40%. (Assume that flotation costs are negligible and bond coupons are paid annually.) a. What is the after-tax cost of debt, preferred stock and common stock?
b. What is the weighted average cost of capital for the firm, if the current capital structure based on market values is the optimal capital structure?

Read the overview below and complete the activities that follow.apartment complexes often look for ways to recruit new tenants and retain current tenants. although apartment complexes offer the tangible benefit of shelter to their tenants, many apartment complexes also offer additional services to tenants to encourage tenants to stay or to support the rent prices. the following scenario identifies the several service gaps of a company that runs an apartment complex as well as solutions for reducing these service gaps.concept review: customers have certain expectations about how a service should be delivered. a service gap occurs when the delivery of a service fails to meet customer expectations. there are four types of service gaps: knowledge gap, standards gap, delivery gap, and the communications gap. it is important for marketers to identify these gaps and develop strategies for minimizing them.match the example or solution to the appropriate service gap category.1. wait for repairs 5. train employees well2. understand expectations 6. incentives for tenants3. do not overpromise 7. family movie night4. empower employees 8. delayed lawn careservice gap example solutionknowledge gap standards gap delivery gap communication gap