$8)$ A firm has determined its cost of each source of capital and optimal capital structure, which is composed of the following sources and target market value proportions:

SOURCE OF CAPITAL TARGET MARKET PROPORTION AFTER TAX COST

LONG TERM DEBT $45\%5\%$

PREFERED STOCK $1014$

COMMON STOCK EQUITY $4522$

If the firm were to shift toward a more leveraged capital structure $($i$.$e$.,$ a greater percentage of debt in the capital structure$),$ discuss how the weighted average cost of capital would change.