Question 4: One of your clients has provided you with the following data relative to current costs and for various ranges of financing for its basic sources of external capital: long-term debt, preferred stock (preference shares), and common stock equity (ordinary shares). Source of Capital After-tax Cost Long-term debt 9% 10% 12% Preferred stock Range of Total New Financing 0 to 800,000 800,001 to 1,200,000 200,001 and above 0 to 400,000 400,001 and above 0 to 300,000 300,001 to 650,000 650,001 to 900,000 900,001 and above 21% 23% 22% 26% 28% 32% Common stock The firm expects to have 165,000 of current retained earnings in the coming year at a cost of 22%; once these retained earnings are exhausted, the firm will issue new common stock. The company's target capital structure proportions used in calculating the weighted average cost of capital are: Source of Capital Target Capital Structure Long-term debt 35% Preferred stock 10% Common stock equity 55% (a)Calculate the weighted average cost of capital for the firm prior to issuing new common stocks