The director for S Corp. manufacturers of playground equipment, is considering a plan to expand production facilities in order to meet an increase in demand. He estimates that this expansion will produce a rate of return of 11%. The firms target capital structure calls for a debt/equity ratio of .8 . S Corp has a bond issue outstanding for that will mature in 25 years and has a 7% annual coupon rate. The bonds are currently selling for $804. The firm has maintained a constant growth rate of 6%. S Corps next expected dividend is $2(D1) and it current stock price is $40. Its tax rate is 21%. Should it undertake the expansion?

Calculate the WACC( Weighted Average Cost of Capital)

Please show how to calculate the WACC step by step. Thanks!