Soreasen Systems Inc. is expected to pay a $2.50 dividend at year end (D1=$2.50), the dividend is expected to grow at a constant rate of 5.5085 a year, and the common stock currently sells for $87.50 a share. The before-tax cost of debt is 7.50%, and the tax rate is 25%. The target capital structure consists of 45% debt 55% common equity. What is the company's WACC if all the equity used is from retained earnings? Do not round your intermediate calculations. a. 6.9940 b. 5.98% c. 7.216 d. 6.85% e. 7.13w Simms Comp. is considering a project that has the following cash flow data. What is the project's IRR? Note that a project's projected IRR can be less than the WACC or negative, in both cases it will be rejected. a. 8.13% b. 7.55% c. 11.76\% d. 26.73% e. 24.394% Nagel Equipment has a beta of 0.86 and an expected dividend growth rate of 3.40% per year. The T-bill rate is 4.00%, and the T-bond rate is 5.25%. The annual return on the stock market during the past 4 years was 10.25%. Investors expect the average annual future return on the market to be 14.75\%. Using the SML, what is the firm's required rate of return? Do not round your intermediate calculations. a. 16.82% b. 12.69% C. 9.55% d. 13.42% e. 13.25% You were hired as a consultant to Giambono Company, whose target capital structure is 50% debt, 15% preferred, and 35 common equity. The after-tax cost of debt is 6.00%, the cost of preferred is 7.50%, and the cost of retained earnings is 17.00%. The firm will not be issuing any new stock. What is its WACC? a. 10.178 b, 4.13% c. 7.08\% d. 10.08\% e. 8.95\%