A firm has a debt-to-equity ratio of 3:1. The firm's debt beta is 0.8. Five-year government bonds yield 5% pa with a coupon rate of 4% pa. The market's expected dividend return is 5% pa and its expected capital return is 5% pa. The firm stock's next dividend is expected to be $2, paid one year from now. Dividends are expected to be paid annually and grow by 2% pa forever. The current stock price $20. The corporate tax rate is 30%. Assume a classical tax system. Which statement is NOT correct? O a. The expected return on equity is 12% pa. O b. The beta of the firm's assets is 0.95. . The firm's after-tax WACC is 7.725% pa. Od. The beta of the firm's equity is 0.7. The expected return on debt is 9% pa. Oe