In order:

1. https://gyazo.com/997dd6a283e2e20732a14b90caead817

2: A) 3.00% B) 13.50% C) 1.50% D) 16.50%

3. https://gyazo.com/e27a376ab8ece4a3c578bcb3a16b1494

4. A) 6.00% B) 10.00% C) 5.50% D) 15.00%

5. https://gyazo.com/dd579d3fd505f4546c6080ac091ba1e3

6. A) 30.00% B) 25.00% C) 40.00% D) 20.00%

Suppose Mullens Corporation is considering three average-risk projects with the following costs and rates of return: Mullens estimates that it can issue debt at a rate of rd=15.00% and a tax rate of T=10.00%. It can issue preferred stock that pays a constant dividend of Dp=$5.00 per year and at Pp=$50.00 per share. Also, its common stock currently sells for P0=$23.75 per share. The expected dividend payment of the common stock is D1=$4.75 and the dividend is expected to grow at a constant annual rate of g=5.00% per year. Mullens' target capital structure consists of ws=80.00% common stock, wd=10.00% debt, and wp=10.00% preferred stock. According to the video, the after-tax cost of debt can be stated as . Plugging in the values for rd and (T) yields an after-tax cost of debt of approximately According to the video, the cost of preferred stock can be stated as . Plugging in the values for Dp and Pp yields a cost of preferred stock of of approximately Hint: Assume no flotation costs. According to the video, the cost of common stock can be stated as . Plugging in the values for D1,P0, and g yields a cost of common stock of approximately Recall that the equation for the weighted average cost of capital (WAAC) can be stated as