Peacock Corp needs $24 million to build a new assembly line. The target debt-equity ratio of the company is 0.60. The flotation cost for new equity is 7%, but the flotation cost of debt is only 3%.

a) What is Peacock's weighted average flotation costs assuming all equity is raised externally. (2 marks)

b) What is the true cost of building the new assembly line after taking flotation costs into account. (2 marks)