technology. Trenton operates general merchandise retail stores. Selected data for these the market value of the debt equals its book value. (S amounts in millions 4. (24 points) Watson manufactures and sells appliances. Intro develops and manufactures computer companies appear in the following table (dollar amounts in millions). For each firm, assume that Watson Intro Trenton Total Assets 13,532 $109,524$44,106 2,597 S33,925 6.190 $18,752 4.9% Interest-Bearing Debt 4.3% Average Pretax Borrowing Cost Common Equity 3,00613,465 $13,712 $22,521 35.0% Book Value Market Value S 2,959 $110,984 35.0% | 35.0% 0.78 Income Tax Rate Market Equity Beta 2.27 Required a. Assume that the intermediate-term yields on U.S. Treasury securities are roughly 3.5 percent. Assume that the market risk premium is 5.0 percent Compute the cost of equity capital for each of the three companies. (6 points) b. Compute the weighted average cost of capital for each of the three companies. (6 points) c. Compute the unlevered market (asset) beta for each of the three companies. (6 points) d. You just acquired the company Intro, given the unlevered market (asset beta), you want to have an equity beta not higher than 0.9, say, exactly 0.9. How should you structure your capital, that is, what percentage of debt can you use in your total capital? (6 points)