The company's optimum capital structure is $40$ percent debt, $10$ percent preferred stock, and $50$ percent common equity in the

form of retained earnings. Refer to the folbwing table on bond issues for comparative yields on bonds of equal risk to

Northwest.

a Compute the cost of debt, $K_d.$

Note: Do not round Intermedlate calculations. Input your answer a a percent rounded to $2$ decimal places.

b$.$ Compute the cost of prefered stock, $K_p.$

Note: Do not round Intermedlate calculations. Input your answer a a percent rounded to $2$ decimal places.

Costotpretered $s$ bok

$831\%$

c$.$ Compute the cost of common equity in the form of retained earnings, $K_{}.$

Note: Do not round Intermedlate calculations. Input your answer a a percent rounded to $2$ decimal places.

Costotommor equly

$1231\%$

d$.$ Cakulste the weighted cost of each source of capital and the weighted sverage cost of capital.

Note: Do not round intermedlate calculations. Input your answers a a percent rounded to $2$ decimal places.