Bunga Company wishes to measure its cost of capiral;. The firms tax rate is 25% and the capital structure of the company includes 30% long term debt , 25% preferred stock and 45% common stock. Bunga's financial manager has gathered the following data . Debt: The firm can sell a 22 year, RM1000 par value , 6% bond . A flotation cost of 25 RM per bond would be requred in addition to the discount of RM20.

Preffered stock: The firm has determined it can issue preferred stock at RM100 per share par value. The preferred stock will pay an 8% annual dividends . The cost of issuing and selling the preferred stock is RM4 per share.

Common stock : A firm;s common stock is currently selling for RM50 per share . the dividend expected to be paid at the nd of the coming year is RM4. Its dividend payments have been growing at a constatnt rate at 5% and it expected to continue into the future . A new common stock issue must be underpriced by RM3 per share m the company will pay RM2 per share in floatation cost .

1. Calculate the firm's after tax cost of debt

2. Calculate the firm's cost of preferrerd stock

3. Calculate the firm's cost of new common stock

4. Calculate the firm's WACC using the given capital stucture weights

5. What role does the cost of capital play in the firm's long term investment decisions and how does it relate to the firm's ability to maximize shareholder wealth