5. You have been hired as a consultant by Feludi Inc.'s CFO, who wants you to help her estimate the cost of capital. You have been provided with the following data: rRF = 4.10%; RPM = 5.25%; and b = 1.30. Based on the CAPM approach, what is the cost of common from retained earnings?

6. Avery Corporations target capital structure is 35% debt, 10% preferred, and 55% common equity. The interest rate on new debt is 6.50%, the yield on the preferred is 6.00%, the cost of common from retained earnings is 11.25%, and the tax rate is 40%. The firm will not be issuing any new common stock. What is Avery's WACC?

7. Kings Corp has determined that its before-tax cost of debt is 9.0%. Its cost of preferred stock is 12.0%. Its cost of internal equity is 15.0%, and its cost of external equity is 17.0%. Currently, the firm's capital structure has $600 million of debt, $50 million of preferred stock, and $350 million of common equity. The firm's marginal tax rate is 40%. The firm is currently making projections for next period. Its managers have determined that the firm should have $100 million available from retained earnings for investment purposes next period. What is the firm's marginal cost of capital (WACC) at a total investment level of $250 million?

8. Using the same information from question 7. What is the firm's marginal cost of capital (WACC) at a total investment level of $ 400 million?