9. Problem 10.08 (Cost of Common Equity and WACC) eBook Palencia Paints Corporation has a target capital structure of 35% debt and 65% common equity, with no preferred stock. Its before-tax cost of debt is 10%, and its marginal tax rate is 40%. The current stock price is Po $22.00. The last dividend was Do $4.00, and it is expected to grow at an 8% constant rate. What is its cost of common equity and its WACC? Do not round intermediate calculations. Round your answers to two decimal places. = a. rs = % b. WACC = %