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

A bond that has a $1,000 par value (face value) and a contract or coupon interest rate of 11.7 percent. Interest payments are $58.50 and are paid semiannually. The bonds have a current market value of $1,120 and will mature in 10 years. The firm's marginal tax rate is 34 percent.

A new common stock issue that paid a $1.83 dividend last year. The firm's dividends are expected to continue to grow at 7.6 percent per year, forever. The price of the firm's common stock is now $27.18.

A preferred stock that sells for $154, pays a dividend of 8.4 percent, and has a $100 par Value.

A bond selling to yield 11.6 percent where the firm's tax rate is 34 percent.

a.The after-tax cost of debt is_%. (Round to two decimal places.)

b.The cost of common equity is_%. (Round to two decimal places.)

c.The cost of preferred stock is_%. (Round to two decimal places.)

d.The after-tax cost of debt is_%. (Round to two decimal places.)