Amalgamated Products has two operating divisions, foods and electronics.

$$ The firm has $$20$ M of risk$-$free debt outstanding.

$$ The market value of its equity is $$30$ M$.$

$$ The risk$-$free rate is $4\%$ and the market risk premium is $8\%.$

$$ There are no corporate taxes.

$$ The equity beta is $2\mathrm{.}9.$

$$ The electronics division is financed for half by debt of its total value.

$$ The food division is financed $100\%$ by equity.

a$.$ Calculate the expected return on equity for Amalgamated.

b$.$ Evaluate the cost of capital for each one of Amalgamated divisions $($Electronics and Food$).$

c$.$ Evaluate the cost of capital for Amalgamated.