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Given the following information: ABC firm is going to pay dividend $2 per share shortly The current stock price is $50 per share and there

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Given the following information: ABC firm is going to pay dividend $2 per share shortly The current stock price is $50 per share and there are 3 million shares of outstanding stocks Firm beta is equivalent to market average beta Constant growth rate is 5% Market risk premium is 12% and risk free rate is 2% Total value of debt is $250 million Cost of borrowing/issuing bond is 5% Corporate tax rate 30% a) What is the cost of equity using dividend growth model? List the formula, input numbers and calculate answers b) What is the cost of equity using CAPM model? List the formula, input numbers and calculate answers c) What are the weights for common stock and debt, respectively? d) What is the WACC for your firm using cost of equity from CAPM? List the formula and input numbers, no calculation needed

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