1. A publicly-held corporation has recently reported the following financial statements as of 31/12/2020. Balance sheet Assets Liabilities and equity Short-term assets 3,000,000 Debt 12,000,000 Long-term assets 7,000,000 Equity 1,000,000 Income statement (2020) Sales 50,000,000 COGS 40,000,000 Other expenses 5,000,000 Gross profit 5,000,000 Interest on debt 2,000,000 Net taxable profit 3,000,000 Net profit after taxes 2,400,000 The company has outstanding 1 million shares of common stock, currently traded at a price of $10/share in Borsa stanbul. a. If the risk-free rate of interest (current yield on short-term T-bills) is 12%, the stock market is expected to return 18% next year and the company's estimated (CAPM) beta is 1.5, what is the required rate of return on its equity? b. Calculate the company's weighted average cost of capital