A US company is planning to issue new shares in the stock market. The risk-free rate is 3% and the expected return on the market this year is expected to be 18%.

1. If the companys costs of debt is 08%, what is the domestic weighted average cost of capital if it uses 40% debt and the tax rate is 35%? Assume the beta of the stock is 0.8.
2. If the global beta is 0.90 and the expected return on a world market portfolio is 16%, what is the weighted average cost of capital if we use the global beta and world market portfolio? Assume the same proportion of debt and tax rate.
3. What percent of debt and equity should they hold to have a WACC to be 10.5%, using global beta and the world market portfolio?