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Ninja Turtle Industries (NTI) needs to raise capital. The firm only cares about price. Given the...

Ninja Turtle Industries (NTI) needs to raise capital. The firm only cares about price. Given the following information about NTI’s capital, what type of capital is the cheapest, and which one should it use to raise money?

Bonds:

Current Price: $600

Coupon: 7%

Time: 10

Par Value: $1000

Coupon Paid: Semi-annually

Stock:

Beta: 0.8

Market Risk Premium: 8%

Historical Market Rate: 10%

3-Month T-Bill Rate: 2%
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