Rollins Corporation's target capital structure is 20% debt, 20% preferred stock, and 60% common equity (Retained earnings). Its bonds sell for $1,000 have a 12% coupon rate, mature in 20 years and and will incur a floatation cost of $50 per bond.

The firm could sell, at par, $100 preferred stock which pays a 12% annual dividend, with flotation costs of 5%.

Rollins' beta is 1.2, the Return on Government Notes is 10%, and the market return is 15%.

Rollins and has a growth rate of 8% and its current stock price $27.00 with recent dividends of $2.00, per share. Floatation costs are 10%on new issues.

The firm's policy is to use a risk premium of 3.3% when using the bond-yield-plus-risk-premium method to value Retained earnings.

The firm's marginal tax rate is 40%.

What is Rollins' component cost of debt?	7.62% 13.9% 16% 12% 12.6 12.7% 13.6%
What is Rollins' cost of issuing Preferred stock?	7.62% 13.9% 16% 12% 12.6 12.7% 13.6%
What is Rollins' cost of retained earnings using the CAPM approach?	7.62% 13.9% 16% 12% 12.6 12.7% 13.6%
What is the firm's cost of retained earnings valued as common stock?	7.62% 13.9% 16% 12% 12.6 12.7% 13.6%
What is Rollins' cost of retained earnings using the bond-yield-plus-risk-premium approach?	7.62% 13.9% 16% 12% 12.6 12.7% 13.6%
What is Rollins' lowest WACC?