(Calculating the woighted average cost of capital) You are working as a consultant to the Lulu Arlofic Cloeting Company, and you have been asked to compute the appropriate discount rate to use in the evaluation of the purchase of a new warehouse facily. You hove defermined the market value of the firm's current captat structure (which the frm considers to be fis target mik of financing sources) as follows: To finance the purchase, Lulu will sel 20 towuts with a $1,000 par value paying 6.2 percent per year (wth indorest paid senviarnualy) at the market price of $1,016. Proferred stock paying a $2.45 dividend can be sold fer $35.86. Common stock for Lifu is currently selling for $.49.49 per shave. The fim paid a $3.94 dividend last year and expects dividends to continue growing at a rate of 3.7 percent per year for the indefnite future. The fims's maginal twac rate is 34 percent. What discount tate should you use to evaluste the warehouse project? a. Calculate component weights of capital The weight of debt in the firmb eapial stucture is K. (Round to two decimal places.) The weight of prefered stock in the firm's capital structure is 5. (Round to two decimal places) The weipht of common stock in the ferm's captal strocture is K. (Reund to two decimal places.) b. Calculate component costs of capital. The after-tax cost of debt for the flem is 16 . (Round to two decimal places) The cost of preferred stock for the firm is $. (Round to two decimal places.) The cont of common equity for the frm is 14. (Round to two decimal places ) c. Calculatin the firmis woighted average cost of captat. The dscount rate you should use to evaluate the warehouse proinct is %. (Round to three decimal places.)