ABC Company and XYZ Company are identical firms in all respects except for their capital structure. ABC is all$-$equity financed with $$525,000$ in stock. XYZ uses both stock and perpetual debt; its stock is worth $$262,500$ and the interest rate on its debt is $5\mathrm{.}3$ percent. Both firms expect EBIT to be $$57,000.$ Ignore taxes.

a$.$

Rico owns $$26,250$ worth of XYZ$$s stock. What rate of return is he expecting? $($Do not round intermediate calculations and enter your answer as a percent rounded to $2$ decimal places, e$.$g$.,32\mathrm{.}16.)$

b$.$ Suppose Rico invests in ABC Company and uses homemade leverage to match his cash flow in part $($a$).$ Calculate his total cash flow and rate of return. $($Do not round intermediate calculations and enter your return answer as a percent rounded to $2$ decimal places, e$.$g$.,32\mathrm{.}16.)$

c$.$ What is the cost of equity for ABC and XYZ$?($Do not round intermediate calculations and enter your answers as a percent rounded to $2$ decimal places, e$.$g$.,32\mathrm{.}16.)$

d$.$ What is the WACC for ABC and XYZ$?($Do not round intermediate calculations and enter your answers as a percent rounded to $2$ decimal places, e$.$g$.,32\mathrm{.}16.)$