Ashman Motors is currently an all equity firm. It has two million shares outstanding, selling for

$43 per share. The company has a beta of 0.80, with the current risk free rate at 3.5% and the

market premium at 7.6%. The tax rate is 40% for the company. Ashman has decided to sell $43 million of bonds and retire half its stock. The bonds will have a yield to maturity of 8.1%. The

beta of the company will rise to 1.2 with the new debt. The company will be able to buy back the shares at $43 per share. What was Ashman's WACC before selling the bonds? . What is its new WACC after selling the bonds and retiring the stock with the proceeds from

the sale of the bonds?