Arrange Lancaster Engineering Inc. (LEI) has the following capital structure, which it considers to be optimal Debt 25% Preferred stock Common equity 15% 60% 100% Total LEI is expected to pay a dividend of 53.24 per share next year, its stock currently sells for $54 per share, and investors expect dividends to grow at a constant rate of 9 percent in the future. LEIS tax rate is 40 percent LEI can obtain new capital in the following ways: New preferred stock with a dividend of 59.5 can be sold to the public at a price of $95 per share. Debt can be sold at an interest rate of 12 percent. a. Determine the cost of each capital component. b. Calculate the WACC. c. LEI has the following investment opportunities that are average-risk projects for the firm Project Cost att - 0 Rate of Return A $10,000 16.4% B 20,000 15.0% C 10,000 13.2% D 20,000 12.0% 10,000 Which projects should LEI accept? Why? 11.596 06 Narks