(appoints) Question 2 Percy Motors has a target capital structure of 60% debt and 40% common equity, with no preferred stock. The yield to maturity on the company's outstanding bonds is 9%, and its tax rate is 40%. (a). If Percy's cost of equity is 10%, what is Percy's WACC? (3 points) (b). Assume that the company issues new common stock sells at $100 and the flotation cost is 8%. The company paid dividend $2 per share for last year and it is expected to grow at 5% per year. What is Percy's WACC if equity capital is raised from this new issuing? (3 points) (c). Tellmehow incorporation is paying a dividend of 3.5 per share this year. The company pledges to increase dividend by 2.6 percent per year indefinitely. If you require a return of 11 percent on your investment, how much are you willing to pay for the stock today? (3 points)