Delta Corporation has the following capital structure: Cost (aftertax) (Debt) cost- 8.1% weights -35% weights cost -2.84 %, (Preferred stock) cost - 9.6 weights- 5 weights cost -0.48 (Common equity) cost 10.1, weights 60, weights cost 6.06

Weighted average cost of capital 9.38 %

a. If the firm has $18 million in retained earnings, at what size capital structure will the firm run out of retained earnings? (Enter your answer in millions of dollars (e.g., $10 million should be entered as "10").)

b. The 8.1 percent cost of debt referred to earlier applies only to the first $14 million of debt. After that the cost of debt will go up. At what size capital structure will there be a change in the cost of debt? (Enter your answer in millions of dollars (e.g., $10 million should be entered as "10").