premium is 8.3 percent , T-bills are yielding 4 percent , and the company ’ s tax rate is 36 percent . a . What is the firm ' s market value capital structure ? b . If the company is evaluating a new investment project that has the same risk as the firm ' s typical project , what rate should the firm use to discount the project ' s cash flows ? 33 . Filer Manufacturing has 8.9 million shares of common stock outstanding . The current share price is $ 59 , and the book value per share is $ 4 . The company also has two bond issues outstanding . The first bond issue has a face value of $ 71.2 million and a coupon rate of 7.6 percent and sells for 107.7 percent of par . The second issue has a face value of $ 61.2 million and a coupon rate of 8.1 percent and sells for 110.1 percent of par . The first issue matures in 8 years , the second in 27 years . Suppose the company ’ s stock has a beta of 1.2 . The risk-free rate is 3.7 percent , and the market risk premium is 7.6 percent . 34 . When estimating the cost of equity using the DDM , which one of these is most apt to add error to this estimate ? 35 . When computing WACC , you should use the : 36 . The cost of preferred stock : 37 . No matter how many forms of investment analysis you employ : 38 . Which statement concerning the net present value ( NPV ) of an investment or a financing project is correct ? 39 . The net present value method of capital budgeting analysis does all of the following except : 40 . Graham and Harvey ( 2001 ) found that _____ were the two most popular capital budgeting methods . 41 . The primary reason that company projects with positive net present values are considered acceptable is that : 42 . What is the net present value of a project with an initial cost of $ 36,900 and cash inflows of $ 13,400 , $ 21,600 , and $ 10,000 for Years 1 to 3 , respectively ? The discount rate is 13 percent . 43 . Flatte Restaurant is considering the purchase of a $ 10,800 soufflé maker . The soufflé maker has an economic life of five years and will be fully depreciated by the straight-line method . The machine will produce 2,400 soufflés per year , with each costing $ 2.80 to make and priced at $ 5.65 . Assume that the discount rate is 16 percent and the tax rate is 35 percent . What is the NPV of the project ? Should the company make the purchase ? 44 . A project costing $ 6,200 initially should produce cash inflows of $ 2,860 a year for three years . After the three years , the project will be shut down and will be sold