Adamson porc isidering verage-risk projects lowing costs and 1 16.00% Project Cost Expected Rate of Return $2,000 2 3,000 15.00 3 5,000 13.75 2,000 12.50 The company estimates that it can issue debt at a rate of ra = 10%, and its tax rate is 25%. It can issue preferred stock that pays a constant dividend of $5.00 per year at $46.00 per share. Also, its common stock currently sells for $34.00 per share; the next expected dividend, D1, is $4.25; and the dividend is expected to grow at a constant rate of 4% per year. The target capital structure consists of 75% common stock, 15% debt, and 10% preferred stock. 4 a. What is the cost of each of the capital components? Do not round intermediate calculations. Round your answers to two decimal places. Cost of debt: % % Cost of preferred stock: Cost of retained earnings: % b. What is Adamson's WACC? Do not round intermediate calculations. Round your answer to two decimal places. % -Select- c. Only projects with expected returns that exceed WACC will be accepted. Which projects should Adamson accept? Project 1 Project 2 Project 3 Project 4 -Select- -Select- -Select