The current market rate of return, E$($RM$)$ is $12\%$ and the risk$-$free rate, RF is $4\%.$ You have been given the job of determining your firm$$s cost of capital components. The company has $100,000$ shares outstanding with a current market value of $$60$ per share. The debt represents $25\%$ of the capital structure in market value and the yield to maturity is $8\%.$ The beta of the equity is $1\mathrm{.}2$ and the tax rate is $30\%.$

$1)$ What is the market value of the firm$$s debt?

$($a$)$ $$1$ mil $($b$)$ $$1\mathrm{.}25$ mil $($c$)$ $$1\mathrm{.}5$ mil $($d$)$ $$1\mathrm{.}75$ mil $($e$)$ $ $2$ mil

$2)$ What is the required rate of return on equity?

$($a$)13\mathrm{.}6\%($b$)14\mathrm{.}4\%($c$)15\mathrm{.}2\%($d$)15\mathrm{.}8\%($e$)16\mathrm{.}4\%$

$3)$ What is the after$-$tax cost of debt?

$($a$)4\mathrm{.}8\%($b$)5\mathrm{.}6\%($c$)5\mathrm{.}8\%($d$)7\mathrm{.}4\%($e$)8\mathrm{.}0\%$

$4)$ What is the firm$$s WACC?

$($a$)10\mathrm{.}5\%($b$)11\mathrm{.}6\%($c$)12\mathrm{.}75\%($d$)13\mathrm{.}0\%($e$)13\mathrm{.}25\%$