2 of 2 3. On January 1, the total market value of the IAM Appmaths Company was TL100 million The firm's present market value capital structure shown below, is considered to be optimal. There is no short-term debt. Debt TL30,000,000 Common equity TL 70,000,000 Total capital TL100,000,000 The company's 10% coupon 1,000 par 5 years to maturity outstanding bonds are selling at TL900. The company has a beta of 1.5; the risk free rate is 10%, market risk premium is 4%. Common stock is currently selling at TL20 a share. The next expected dividend is TL2.0, and the constant growth rate is 6%. The marginal tax rate is 30% a Dou you think the company's stock price is in equilibrium? (Assume that the company makes all payouts in the form of dividends) (10 Pts) b. Assuming there is sufficient cash flow for IAM Appmaths to maintain its target capital structure without issuing additional shares of equity, what is its WACC? (7.5 Pts) c. Suppose now that there is not enough internal cash flow and the firm must issue new shares of stock. Qualitatively speaking, what will happen to the WACC? No numbers are required to answer this question. (7.5 Pts)