1. Calculate DOL, DFL, DTL (30 POINTS) Income Statement Millions ($) 9.8 7.2 1.5 Revenues Variable operating costs Fixed operating costs Operating income Interest Taxable income Tax 1.1 0.6 0.5 0.2 Net income 0.3 2. Explain hamada equation by giving example (10 POINTS) 3. Explain by giving example the dilemma of decision to use debt or equity in other words leveraging or unleveraging (10 POINTS) 4. Calculate WACC (30 POINTS) A firm's estimated costs of debt, preferred stock, and common stock are 12%, 17%, and 20%, respectively. Assuming equal funding from each source and a marginal tax rate of 40%, the weighted average cost of capital (WAAC) is closest to: 5. Explain flotation costs (10 POINTS) 6. Explain differences among methods used to calculate Cost of common equity(10 POINTS)