Saved Question 1 (3 points) Listen a) Why are market - based weights of different sources of financing such as common stock, preferred stock, and debt (or bond) important in determining the weighted average cost of capital of a firm? (2 marks) b) While calculating weighted average cost of capital (WACC), we need to adjust cost of debt (bond, for example) for taxes. Why do we need to make such an adjustment? (1 mark)