1. Watson Corporation uses bonds, preferred stocks, and common stock finance. The capital structure of the company and required returns are listed below. Capital Structure Required Return Bonds 30% 7% Preferred stock 15% 6.8% Common stock 55% 11% Other financial information (dollars in millions) o Market value of the debt $300 o Market value of the preferred stock - $150 o Net Income available to common shareholders $90 o Interest expenses $25 o Preferred dividends -$7 o Depreciation $30 o Investment in fixed capital - $60 o Investment in working capital - $15 o Net borrowing - $25 o Tax rate 35% Stable growth rate of FCFF-4% o Stable growth rate of FCFE 5.5% a) Calculate Watson Corporation's WACC. (2 points) b) Calculate the current value of FCFF (FCFF0). (2 points) c) Based on single-stage FCFF model, what are the total value of Watson Corporation and the value of its equity, respectively? (3 points) d) Calculate the current value of FCFE (FCFE0). (2 points) c) Based on single-stage FCFE model, what is the current value of equity for Watson Corporation? (2 points) In your written response, please start with question numbers such as a), b), c), d), or e) before showing your work and answer to the