Kd$=$credit risk rate$(1-$tax rate$)$Kd$=\mathrm{.}09(1-\mathrm{.}46)$Kd$=\mathrm{.}0486$Kd$=4\mathrm{.}86\%$Kp$=$PDIV$/($P$0-$ flotation cost$)$PDIV$=$P$0*$ YieldPDIV$=50\mathrm{.}06$PDIV$=3$Flotation cost$=50*\mathrm{.}03=1\mathrm{.}50$Kp$=3/50-1\mathrm{.}50$Kp$=\mathrm{.}0619$Kp$=6\mathrm{.}19\%$Ke$=$Div$0(1+$g$)/$P$0+$ gKe$=1\mathrm{.}50(1+\mathrm{.}08)/20+\mathrm{.}08$Ke$=\mathrm{.}161$ or $16\mathrm{.}1\%$Kn$=$ D$0(1+$g$)/($P$0-$F$)+$gF$=20\mathrm{.}08=1\mathrm{.}6$Kn$=1\mathrm{.}50(1+\mathrm{.}08)/(20-1\mathrm{.}6)+\mathrm{.}08$Kn$=16\mathrm{.}8\%$

a$)$calculate the weighted average cost of capital using Ke