a. Forst produces beers. It has an enterprise value of 1.000, debt equal to 400, cost of debt equal to 5%, beta of equity of 0.8, and the corporate tax rate is 25%. The risk free rate is 3% and the equity risk premium is 6%. What is Forst Wacc?

b. Forst is considering to expand its business to diversify its risk by acquiring the assets of a company in the restaurant industry. There are three Restaurant companies (Seaside, Penny's and Foodfest) traded in the stock market, and their information are provided in the table below. Forst plans to fund the acquisition with the same capital structure of its beer producing business (i.e.: D/EV=40%). Assuming that the corporate tax is 25%, the risk free rate is 3% and the equity risk premium is 6%, what is the WACC that Forst should use to evaluate its investment in the restaurant industry?

Company	Equity beta	Debt/equity Ratio	Debt beta
Seaside	1.13	0.15	0.00
Penny's	1.80	1.06	0.15
Foodfest	3.27	3.52	0.30