QUESTION 3: (10 marks) a) Briefly identify and describe some important uses of a firm's weighted average cost of capital. (2 marks) b) Lincon Company's common stock is currently selling for $30. Last year's dividend was $2.00 per share. Investors expect dividends to grow at an annual rate of 5% into the future. i. What is Hoak's cost of common equity? (4 marks) ii. Selling new common stock is expected to decrease the price of the stock by $5.00. What is the cost of new common stock? Dividends will remain the same. (4 marks)