Question 18 (1 point) Morales Publishing company is trying to estimate its optimal capital structure. Morales's current capital structure consists of 25% debt and 75% equity; however, the management believes the firm should use more debt. The risk-free rate is 5.0% and the market risk premium is 6.0%, and the firm's tax rate is 35%. Currently, Morales cost of equity is 15%, which is determined on the basis of CAPM. What would be Morales's estimated cost of equity if it were to change it capital structure from its present capital structure to 35% debt and 65% equity? 15.63% 16.12% 20.05% 20.26% 17.89% Question 19 (1 point) The Christmas Company will produce 60,000 units of lighted-Christmas trees next year. Variable costs will equal 35% of dollar sales, while fixed costs total $200,000. At what price must each lighted-Christmas tree be sold for the firms' EBIT to be $1,500,000? $46.96 $46.87 O $47.77 O $47.95 $43.59