Ferrari's IPO and WACC. Ferrari, the famous high-performance automotive group, launched its initial public offering (IPO) on October 20, 2015. Although the share price had initially risen to over 54 euros (E) per share, by the end of the year it had settled to 45 euros (). Ferrari had been owned by Fiat (Italy), and had never calculated its own cost of capital before, one independent of Fiat. It now needed to, and one of isfirst challenges was estimating its beta. With only two months of trading to base it on, the corporate treasury group had started with what were considered "comparable firms, which for Ferrari, meant firms in the luxury goods industry, not automotive. Luxury goods were historically less volatile than the market, so the initial guess on Ferrar's beta was 0.73. Use the assumptions in the popup table, EE. to answer the following questions a. What is Ferrani's cost of debt, after-tax, in euros? b. What is Ferranis cost of equity in euros? c. What is Ferrari's market capitalization? d. What is Ferrarn's total value of equity outstanding? e. What proportion of Ferrari's capital structure is equity? f. What proportion of Ferranis capital structure is debt? g. What is Ferran's weighted average cost of capital? h. What is Ferranis WACC if its beta was higher, like other automotive companies, say 1.24? Value 3.82% 3.81% 20% 0.73 5.10% 165,000,000 45 477,000,000 Component Italian risk-free cost of debt in euros () Ferrari's cost of debt in euros () talian corporate income tax rate Ferrari's prospective beta Italian equity market risk premium (equity return over risk-free rate) Ferrari's shares outstanding errari's share pice in euros Ferrari's debt outstanding in euros