Manola Inc. has 200 million outstanding shares trading at $25 per share. The stock beta is estimated at .80.Manola has also 1 million bonds outstanding with par of $1,000. The bonds have 20 years to maturity, 10% coupon rate and currently they trade at par. Manola tax rate is 20%. The risk-free rate is 3%, while the market risk premium is 5.0%. a. Compute Manola weighted average cost of capital. b. A recession caused market risk premium to rise to 6%, stock price decline to $20 and bond yield to increase to 12%. Compute the new weighted average cost of capital?