Suppose that a firm has $500K in long term debt, $2.5K in preferred stock and $375K in common equity. These aro market values.Assume the yield on the long term debt is 5.6%, the tax rate is 22%, the dividend on the preferted stock is 4.75% and the firm has a market beta of 1.25 . The riak free rate is 2.5% and the market risk premium is 6.31%. Suppose the firm pays of $300K of the debt. The yield remains the same. What is this firm's WAcC now? A. 6.75% B. 7,54% C. 8.15% b. 10.22% QUESTION 14 Suppose that a firm has $500K in iong term debt, $25K in preferred stock and $376K in common equity. These are market values. Assume the yield on the fong temm debt is 5.6%, the tax rate is 22%, the dividend on the preferted stock is 4.75% and the form has a make be ta of 1.25 The riak tree rate is 2.5% and the market risk premium is 6.31% Suppose that the firm's beta Was 2.25. what woud the WACC be? A. 6.02% B. 6.05% C. 3.14% D. 9.52%