Consider the following information for an unlevered firm U EBIT = $1,600 annually Unlevered value Vu = $4,000 Tax rate = 34% Cost of Debt = 10% A levered firm L in the same business risk class has a debt ratio of 0.5. Use the MM propositions to determine: a) The cost of equity for firms U and L (14 marks) b) The after tax WACC for both firms (10 marks) A Bonus Question: From Chapter 16 where we learned the capital structure theory, what are the two goals of financial management? (2 marks)