Question $1-$ Cost of Capital Question Electric City Brews Inc is a publicly traded company based in Scranton, Pennsylvania that produces and sells various types of beverages, including soft drinks, juices, and energy drinks. The company has been in operation for over $20$ years and has established itself as a leader in the beverage industry. One of the company's most popular products is a nationally recognized beer brand. The beer is known for its unique taste and has become a staple at bars and restaurants across the country. As of the end of the last fiscal year, Electric City Brews Inc had $10$ million outstanding shares of common stock, which were trading at a price of $$25$ per share. The company also had three outstanding bonds with different face values, coupons, and prices, as follows: Bond A: Face value of $$20$ million, annual coupon rate of $4\%,$ priced at $95\%$ of face value, and maturity of $5$ years. Bond B: Face value of $$30$ million, annual coupon rate of $5\%,$ priced at $92\%$ of face value, and maturity of $10$ years. Bond C: Face value of $$50$ million, annual coupon rate of $10\%,$ priced at $115\%$ of face value, and maturity of $15$ years. It's worth noting that Electric City Brews Inc does not have any other debt besides the bonds provided. In addition to common stock, the company has $2$ million outstanding shares of preferred stock, which are trading at a price of $$50$ per share and have an annual dividend of $$4$ per share Electric City Brews Inc's management team has determined that the company's beta is $1\mathrm{.}3,$ and they want to calculate the weighted average cost of capital $($WACC$)$ for the company. Assume the following additional information: o The current risk$-$free rate is $2\%.$o The current market risk premium is $6\%.$o The last annual dividend of the common stock was $$1\mathrm{.}50$ per share $($D$0).$o The estimated dividend growth rate for the company is $5\%.$o Corporate Tax Rate is $25\%$ You are tasked with helping the team by completing the following steps: $1.$ Calculate the market value of equity for Electric City Brews Inc based on the number of outstanding shares and the price per share$\mathrm{.}2.$ Determine the cost of common equity using the average of the values found in the Capital Asset Pricing Model $($CAPM$)$ and the Dividend Growth Model $($DGM$)\mathrm{.}3.$ Calculate the market value of debt for Electric City Brews Inc based on the outstanding bonds provided$\mathrm{.}4.$ Calculate the cost of debt based on the given bond information. For simplicity, you can use the Average of YTM of the three bonds the company has$\mathrm{.}5.$ Calculate the market value of preferred stock for Electric City Brews Inc based on the number of outstanding shares and the price per share$\mathrm{.}6.$ Determine the cost of preferred stock using the dividend amount and price per share$\mathrm{.}7.$ Finally, use the market values and costs of equity, debt, and preferred stock to calculate the weighted average cost of capital $($WACC$)$ for Electric City Brews Inc. Show all calculations and formulas used.