Compute the cost of capital for the KONOCO firm for the following:

1. A bond the has a $1.000 par value (face value) and a contract or coupon interest rate of 9%. The bond has a current market value of $1.125 and will mature in 10 years. The firms marginal tax rate is 34%.
2. A new common stock issue that pays a $1.8 dividend last year. The firms dividends are expected to continue to grow at 7% per year forever. The price of the firms common stock is now $27.5.
3. A preferred stock paying a 10% dividend on a $125 par value. The preferred shares are currently selling for 150 $.
4. A bond selling to yield 12% where the firms tax rate is 34%