2. ABC is currently financed as follows: Common stock $50 million Debt $30 million The cost of equity and cost of debt are 16% and 8%, respectively. ABC issues an additional $10 million of stock and uses the money to repurchase debt. What is the expected cost of equity after the recapitalization? Explain why does the cost of equity change or remain the same? Assume that the change in capital structure does not affect the risk of the debt and that the capital market is perfect