Market value of equity of Company XYZ is $300 million and its market value of debt is $200 million. Its beta () is 1.5 , the risk-free rate (Rf) is 3% and the market risk premium (E(RM)Rf) is 6%. Its interest expense for the last fiscal year was $4 million. The value of interest-bearing debt on the last balance sheet was $110 million and $90 million in the previous fiscal year. Corporate income tax rate is 21%. a) Using the Capital Asset Pricing Model, calculate the cost of equity. b) Using historical accounting figures, calculate the cost of debt. c) Compute the weighted average cost of capital