Delta Corporation has the following capital structure: Debt (Kd) Preferred stock (Kp) Common equity (Ke) (retained earnings) Weighted average cost of capital (Kg) X Answer is complete but not entirely correct. $ 1,037 million Capital structure size (X) Cost (aftertax) 10.6% 9.8 8.2 a. If the firm has $51 million in retained earnings, at what size capital structure will the firm run out of retained earnings? Note: Enter your answer in millions of dollars (e.g., $10 million should be entered as "10". Answer is complete but not entirely correct. Capital structure size (Z) Weights 15% 18 X million 25 60 Weighted Cost b. Note: Enter your answer in millions of dollars (e.g., $10 million should be entered as "10".The 10.6 percent cost of debt referred to earlier applies only to the first $18 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? 1.59% 2.45 4.92 8.96%

Delta Corporation has the following capital structure: 0. If the firm has $51 million in retained earnings, at what size capital structure will the firm run out of retalned earnings? Note: Enter your answer in millions of dollors (e.g., \$10 million should be entered as " 10 ". Answer is complete but not entirely correct. Capital structure size (X) b. Note: Enter your answer in millions of dollars (e.g., $10 million should be entered as "10".The 10.6 percent cost of debt referred to earlier applles only to the first $18 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