3. Lo-Tek Industries, the nations largest manufacturer of hammers, has published the following information as of April 30, 2017:

a. Loan: Lo-Tek states that it currently has a newly issued $18 million bank loan with a rate of 9.0%.

b. Bond: In addition, the firm has an 11.0% coupon bond issue with a face value of $30 million that matures in 8 years and has a yield to maturity of 7.0%.

c. Preferred Stock: The firms preferred stock sells for $50 per share and pays an annual dividend of $5.50 per share. There are 2.0 million shares outstanding.

d. Common Equity: The companys common stock sells for $60 per share and is expected to pay a dividend of $3.00 per share by the end of this year (i.e. Div1=$3.00). The dividend is expected to grow at a constant rate of 7% a year. The yield on risk-free Treasury Bills is 3.3% while the market (S&P500) return is believed to be 12.9%. Lo-Tek is a defensive stock with a Beta of 0.906. There are 12 million shares outstanding.

e. The companys tax rate is 35%.

Compute the weights and cost of capital for each component and the Weighted Average Cost of Capital (WACC). Show all work please and thank you.