(Individual or component costs of capital)Compute the cost of capital for the firm for the following:

a.Currently bonds with a similar credit rating and maturity as the firm's outstanding debt are selling to yield

7.11 percent while the borrowing firm's corporate tax rate is

34 percent.

b.Common stock for a firm that paid a $1.04 dividend last year. The dividends are expected to grow at a rate of

4.7 percent per year into the foreseeable future. The price of this stock is now

$25.33

c.A bond that has a $1,000 par value and a coupon interest rate of 11.2

percent with interest paid semiannually. A new issue would sell for

$1151 per bond and mature in

20 years. The firm's tax rate is 34

percent.

d.A preferred stock paying a dividend of

6.66 percent on a

$97

par value. If a new issue is offered, the shares would sell for

$86.57 per share.

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a.The after-tax cost of debt debt for the firm is

? %.

(Round to two decimal places.)

b.The cost of common equity for the firm is

? %. (Round to two decimal places.)

c.The after-tax cost of debt for the firm is

? %.

(Round to two decimal places.)

d.The cost of preferred stock for the firm is

?%.

(Round to two decimal places.)