D) 11.5% Use the following information to answer next five questions. orporation is examining its cost of capital. The company has two sources of long-term fund: long-term debt (bond) and common equity Debt information: 450 bonds outstanding. Its bonds have a 7 percent coupon, paid semi-annually, with 8 corporate tax rate is selling at $980. Par value is $1,000. The years to maturity, and are currently 35% and the floatation cost is $20 Equity information: 51,450 shares outstanding. Little Toy beta is 0.96, the risk-free rate is 3 percent, and the market risk premium is 7.27 percent. itte Toy is a constant dividend growth firm which is expected to pay a dividend of $1.0 hare, sells for $20 per share, and has a dividend growth rate of 4 percent. Floating cos a s is 10% of the current market price. What is Little Toy after-tax cost of debt? 5. A) B) 4.99% 4.88% C) D) 7.82% 6.83% . What is Little Toy cost of equity capital using dividend growth model? A) 9% 10% C) D) 11% 12% B) What is Little Toy cost of equity capital using CAPM or SML approach? A) B) 9% 10% C) D) 11% 12%