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Fields & Company expects its EBIT to be $125,000 every year forever. The firm can borrow at 7 percent. The company currently has no debt,

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Fields \& Company expects its EBIT to be $125,000 every year forever. The firm can borrow at 7 percent. The company currently has no debt, and its cost of equity is 12 percent and the tax rate is 24 percent. The company borrows $205,000 and uses the proceeds to repurchase shares. a. What is the cost of equity after recapitalization? (Do not round Intermedlate calculations and enter your answer as a percent rounded to 2 declmal places, e.g., 3216.) b. What is the WACC? (Do not round Intermedlate calculatlons and enter your answer os a percent rounded to 2 declmal places, e.g., 3216.)

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