1. AGB, Inc. has bonds outstanding with 10% yield to maturity. The common stock is selling at $40 per share. Expected dividend is $2 per share and it will grow at a rate of 7 percent per year. The firm has debt with a market value of $60,000 and common equity with a market value of $80,000. The tax rate is 34 percent. Calculate the cost of the common stock, the after-tax cost of the bond, and the weighted average cost of capital for AGB, Inc