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10-8. Palencia Paints Corporation has a target capital structure debt and common equity, with no preferred stock. They have 35% of debtl The debt has

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10-8. Palencia Paints Corporation has a target capital structure debt and common equity, with no preferred stock. They have 35% of debtl The debt has YTM of 8% and its marginal tax rate is 25%. The current stock price is $22. The last dividend was $2.25, and it is expected to grow at a 5% constant rate. What is its cost of common equity and its WACC

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