Colt Manufacturing has two divisions: 1) pistols; and 2) rifles. Betas for the two divisions have been determined to be beta(pistol)equals=0.8 and beta (rifle)equals=0.9. The current risk-free rate of return is 2%, and the expected market rate of return is 7.5%.The after-tax cost of debt for Colt is 4%. The pistol division's financial proportions are 32.5% debt and 67.5% equity, and the rifle division's are 42.5% debt and 57.5% equity.

a. What is the pistol division's WACC?

b.What is the rifle division's WACC?

a. What is the pistol division's WACC? __% (Round to two decimal places.)

b.What is the rifle division's WACC? __% (Round to two decimal places.)