a. You are required to calculate the Weighted Average Cost of Capital (WACC) of Sethoo & Sons Limited from the data below: Star Limited 1,000,000 250,000 Black Limited Number of Ordinary 2,000,000 Shares (GHC 1.00) Net Income available 600,000 to Ordinary Shares Gross Dividend 500,000 Market Price per share 3.00 Market value of Debts 3,000,000 Annual Growth rate 12% of Dividend Gross Interest yield 10% 200,000 2.00 1,500,000 10% 11% NOTE: The corporation tax rate is 50%. Debts are currently quoted at GHC 100 per block. b. Explain why the Market Value Approach of calculating WACC is preferred to the Book Value Approach c. What are the uses of Weighted Average Cost of Capital? (Total Mark 20) a. You are required to calculate the Weighted Average Cost of Capital (WACC) of Sethoo & Sons Limited from the data below: Star Limited 1,000,000 250,000 Black Limited Number of Ordinary 2,000,000 Shares (GHC 1.00) Net Income available 600,000 to Ordinary Shares Gross Dividend 500,000 Market Price per share 3.00 Market value of Debts 3,000,000 Annual Growth rate 12% of Dividend Gross Interest yield 10% 200,000 2.00 1,500,000 10% 11% NOTE: The corporation tax rate is 50%. Debts are currently quoted at GHC 100 per block. b. Explain why the Market Value Approach of calculating WACC is preferred to the Book Value Approach c. What are the uses of Weighted Average Cost of Capital? (Total Mark 20)