Question 14 (8 points) Listen Strolling Corporation is constructing its Cost of Capital schedule. The firm is at its target capital structure. Its 15 year bonds have a 4.5% coupon rate and sell for $960. Bond coupons are semi-annual. Rolling's stock beta is 1.3, the risk-free rate is 3.0%, and the return on the market portfolio is 7.0%. Rolling is a constant growth firm, and just paid a dividend of $1.50. The stock sells for $35.00 and has a growth rate of 5.1%. The firm's tax rate is 30%. The firm's book value balance sheet is as follows: Assets $35,600, Long Term Debt $36,000, Equity ($1.00 par) $3,874, Retained Earnings -$4,274, Comprehensive Income 1,500. To the nearest .1%, what is the weight of debt that should be used in computing the Weighted Average Cost To the nearest .1%, what is the pre-tax-cost of of Capital? debt? A A To the nearest .1%, what is the cost of retained A/ To the earnings using the Constant Growth Model? nearest .1%, what is the cost of equity using the Capital Asset Pricing Model? A Using your Constant growth model cost of equity, to the nearest .1%, what is Strolling's Weighted Average Cost of Capital?