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11.3. Please answer the question fully. There's part eight, part B, part, C, part D. Please answer correctly! (Individual or component costs of capital) Compute

11.3. Please answer the question fully. There's part eight, part B, part, C, part D. Please answer correctly! image text in transcribed
(Individual or component costs of capital) Compute the cost of capital for the firm for the following: a. Currently bonds with a similar credit rating and maturity as the firm's outstanding debt are selling to yield 8.03 percent while the borrowing firm's corporate tax rate is 34 percent. b. Common stock for a firm that paid a $1.03 dividend last year. The dividends are expected to grow at a rate of 5.9 percent per year into the foreseeable future. The price of this stock is now $25.93. c. A bond that has a $1,000 par value and a coupon interest rate of 12.6 percent with interest paid semiannually. A new issue would sell for \$1, 151 per bond and mature in 20 years. The firm's tax rate is 34 percent. d. A preferred stock paying a dividend of 7.9 percent on a $97 par value. If a new issue is offered, the shares would sell for $83.45 per share. a. The after-tax cost of debt debt for the firm is %. (Round to two decimal places.)

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