12. Skyline Aero stock is currently selling for $18 a share. The firm is expected to earn $1.98 per share this year and to pay a year-end dividend of $0.72. a. If investors require a 11% return, what rate of growth must be expected for Skyline Aero? b. If Skyline Aero reinvests earnings in projects with average returns equal to the stock's expected rate of return, what will be next year's EPS? 13. Messman Manufacturing will issue common stock to the public for $30. The expected dividend and growth in dividends are $3.00 per share and 5%, respectively. If the flotation cost is 10% of the issue proceeds, what is the cost of external equity,? 14. Suppose a company will issue new 10-year debt with a par value of $1,000 and a coupon rate of 7.5%, paid annually. The tax rate is 30%. If the flotation cost is 2% of the issue proceeds, what is the after-tax cost of debt? 15. Assume that a company has a target debt-to-equity capital structure of 2. The company currently pays 8% annually on its bonds. There are 10 years until maturity, and the bonds currently trade at 93% of par. Bond flotation costs are 3%. The company's beta is 1.5, the and. a. Calculate the WACC b. Assume that the company changed its target capital structure to 47% long-term debt, 20% preferred stock, and 33% common stock. If preferreds are issued at $25, pay a dividend of 7%, and have flotation costs of 5%, recalculate the company's WACC. c. Briefly explain why the WACC has changed