Alfa Corp maintains a debt-to-equity ratio of 0.25. Alfa's cost of debt is 5% and its historical return on equity is 12%. The corporate tax rate is 21%. Alpha is considering a project that is not scale enhancing. A firm with comparable fundamental risk to the new project under consideration has a CAPM beta coefficient for its equity of 1.15 and a CAPM beta coefficient for its debt of 0.2. The comparable firm maintains a debt-to-equity ratio of 0.4. The risk-free rate of interest is 2% and the expected return on the diversified market portfolio is 12%. (a) What does CAPM imply about the expected return on equity rs, the expected return on debt rg and expected return on unlevered equity r, for the comparable firm? (b) Assuming that Alfa maintains a debt-to-equity ratio of 0.25 for the new project, and that Alfa's cost of debt remains at 5%, what weighted average cost of capital should Alfa use for its new project