Maxima Oil is a Canadian oil company. Its current cost of debt is 7.60%, and the 10-year Canada Government Bond yield, the proxy for the risk-free rate of interest, is 3.50%. The expected return on the market portfolio is 8.10%. The company's effective tax rate is 38%. Its optimal capital structure is 30% debt and 70% equity.

1. If Maxima's domestic beta is estimated at 1.50, what is Maxima's weighted average cost of capital?

2. If Maxima's global beta is estimated at 1.20, what is Maxima's weighted average cost of capital?

3. Briefly explain why Maximas WACC has fallen once Maxima entered the global energy market.