3: Weighted Average Cost of Capital (80 points): All calculations you need to do below has formulas, you just need to find the 2017 financial statements ( amazon.com under Investor and look for Annual Report Balance Sheet and Income Statement) and apply the formulas. Please provide detail work.

Find 2017 financial statements for Amazon.Com from UHV Mergent Online database, Yahoo! Finance, Google Finance, or other finance sources.

(1)Estimate the weights of capital (debt, preferred stock, and common stock) for the company.

(2)Estimate the before-tax and after-tax component cost of debt for the firm.

(3)Estimate the component cost of preferred stock (if applicable) for the firm.

(4)Estimate the component cost of common equity using CAPM for the firm.

(5)Compute the firm's weighted average cost of capital (WACC). Discuss your findings.