Consider a firm in a two period (time 1 and time 2) setting with the following distribution of values at time 2: State Probability Values (t=2) 0.5 0.5 $3,600 $1,600 Suppose the corporate tax rate is 50%. If the firm becomes insolvent at time 2, the costs incurred would be $200, which is deducted from the firm's value. Suppose further that time 0 prices of (unit) contingent claims for the two states of the world are each 0.45. a. What is the firm's weighted average cost of capital if the firm's capital is 100% equity financed? b. If there is $600 worth of debt-bearing interest rate of 10% in the firm's capital, what is the firm's weighted average cost of capital? c. If there is $1,000 worth of debt-bearing interest rate of 10% in the firm's capital, what is the firm's weighted average cost of capital? Consider a firm in a two period (time 1 and time 2) setting with the following distribution of values at time 2: State Probability Values (t=2) 0.5 0.5 $3,600 $1,600 Suppose the corporate tax rate is 50%. If the firm becomes insolvent at time 2, the costs incurred would be $200, which is deducted from the firm's value. Suppose further that time 0 prices of (unit) contingent claims for the two states of the world are each 0.45. a. What is the firm's weighted average cost of capital if the firm's capital is 100% equity financed? b. If there is $600 worth of debt-bearing interest rate of 10% in the firm's capital, what is the firm's weighted average cost of capital? c. If there is $1,000 worth of debt-bearing interest rate of 10% in the firm's capital, what is the firm's weighted average cost of capital