anaswr both questions please!

Chapter 12 - End of Chapter Questions and Problems - Question 8 (Part a) O 5.94% O 6.86% 07.74% 9.61% 9.99% LO 3 8. Calculating WACC Baron Corporation has a target capital structure of 75 percent common stock, 5 percent preferred stock, and 20 percent debt. Its cost of equity is 11.3 percent, the cost of preferred stock is 4.9 percent, and the pretax cost of debt is 5.8 percent. The relevant tax rate is 23 percent. a. What is the company's WACC? b. The company president has approached you about the company's capital structure. He wants to know why the company doesn't use more preferred stock financing because it costs less than debt. What would you tell the president? Chapter 12 - Critical Thinking and Concepts Review - Question 2 Book values for debt are likely to be much closer to their market values than are book values for equity True False 2.2 Book Values versus Market Values In calculating the WACC, if you had to use book values for either debt or equity, which would you choose? Why