A Instruction: Complete ALL questions. Caribbean Power Supply Limited has the following capital structure: Debt 40% ii. Preferred shares 10% iii. Common shares 50% The company is issuing preferred stock at $130 per share with a stated dividend of $16.75 and a flotation cost of 5%. For its common stock, Caribbean Power expects the next dividend payment to be $3.30 per share. The price of its common stock is currently $22 and it is estimated that the firm will grow at a constant rate of 5% Also, the cost of debt for is 12% and the tax rate is 40%. A. Compute the cost of debt, preference share and common stock for Caribbean Power Supply Limited. (6 marks) B Calculate the Weighted Average Cost of Capital (WACC). (4 marks) C Comment on the WACC computed at B (2 marks) D. Discuss FOUR (4) problems this company might face as a result of being highly geared (8 marks) (Total 20 marks) Activate Windows