18. (6 points) The component cost of the capital structure for Marcos Corporation are: Kp= 8%, K, = 10 % and K= 12%. According to its latest balance sheet, Marcos Corporation has debt with a book value of $200,000 preferred stock with a book value of $300,000, and common equity with a book value of $500,000. The market value of Marcos Corporation's debt is 80% of the book value, and the current price of preferred stock is $30 and the number of shares is 8,000. The current price of common stock is $40 and the number of shares is 15,000. The tax rate is 40%. What is the WACC for Marcos Corporation using market value weights? 19. (Problems 19-20, 7 points each) A new machine costs $9,000 and is expected to have no salvage value on retirement. The machine will be depreciated for tax purposes in three years by the sum-of -the-years' -digit method. It is expected to generate annual revenue of $20,000 for the next three years and to require an annual operating cost of $10,000 (excluding the depreciation of the machine). The tax rate is 40%. Compute the net cash flow of year 1 (t-1). 20. The ABC Company's current dividend (Do) is $2.00. Its dividend growth rate is expected to be 30% next year, and 20% for the following year, that is, gi30% and g 20%, after which dividends are expected to grow at a constant rate of 7% forever. Connors' required return (Ke) is 15%. What is ABC's current stock price