Big Joe Plc., the entertainment conglomerate, has a beta of 1.61. Part of the reason for a high beta is the debt left over from Joe Plcs leverage buyout of Big Plc in 2009, which amounted to 10billion in 2015. The debt outstanding is as follows: the market value of Bond A is 3billion and the other two bonds, Bond B and Bond C, have equal amounts. The respective hurdle rates are 6.6%, 6.1% and 5.9%. The risk-free rate is 1.9% and the equity risk premium is 4.1%. The marginal tax rate is 19%. The market value of equity of Big Joe Plc in 2015 was also 10billion. The marginal tax rate was 20%. (a) Estimate the WACC. (b) Estimate the unlevered beta for Big Joe Plc. (c) Estimate the effect of reducing the debt ratio by 10% each year for the next two years on the beta of the stock.