Below are the most recent financial statements information for Microsoft Inc. (in million $). Dec.31.2021 Dec.31.2020 136,527 164,784 Financial assets Operating assets Financial Liabilities Operating liabilities Common stockholders' equity Total shares outstanding Financial Income after tax Financial Expense after tax Net Financial Income 130,334 203,445 67,775 124,016 141,988 7,519 70,998 112,009 118,304 7,571 Dec.31.2021 Dec.31.2020 2,790 2,108 1,853 2,047 937 61 The stock price of Microsoft was around $340 at the end of fiscal year 2021. The firm beta is 0.94. Around December 31, 2021, the 10-year US government bond yield is about 1.5%. The market risk premium of US is estimated to be about 3.3%. 1) What is the cost of equity for Microsoft at the end of fiscal year 2021? (3 pts) 2) What is the cost of operations for Microsoft at the end of fiscal year 2021? (7 pts) 3) Compare the above two cost of capital and explain why they are different (3 pts) Below are the most recent financial statements information for Microsoft Inc. (in million $). Dec.31.2021 Dec.31.2020 136,527 164,784 Financial assets Operating assets Financial Liabilities Operating liabilities Common stockholders' equity Total shares outstanding Financial Income after tax Financial Expense after tax Net Financial Income 130,334 203,445 67,775 124,016 141,988 7,519 70,998 112,009 118,304 7,571 Dec.31.2021 Dec.31.2020 2,790 2,108 1,853 2,047 937 61 The stock price of Microsoft was around $340 at the end of fiscal year 2021. The firm beta is 0.94. Around December 31, 2021, the 10-year US government bond yield is about 1.5%. The market risk premium of US is estimated to be about 3.3%. 1) What is the cost of equity for Microsoft at the end of fiscal year 2021? (3 pts) 2) What is the cost of operations for Microsoft at the end of fiscal year 2021? (7 pts) 3) Compare the above two cost of capital and explain why they are different (3 pts)