The following table gives Foust Company's earnings per share for the last 10 years. The common stock, 7.7 million shares outstanding, is now (1/1/19) selling for $77 per share. The expected dividend at the end of the current year (12/31/19) is 40% of the 2018 EPS. Because investors expect past trends to continue, g may be based on the historical earnings growth rate. (Note that 9 years of growth are reflected in the 10 years of data.) Year EPS Year EPS 2009 $3.90 2014 $5.73 2010 4.21 2015 6.19 2011 4.55 2016 6.68 2012 4.91 2017 7.22 2013 5.31 2018 7.80 The current interest rate on new debt is 9%; Foust's marginal tax rate is 40%; and its target capital structure is 45% debt and 55% equity. a. Calculate Foust's after-tax cost of debt. Round your answer to two decimal places. % Calculate Foust's cost of common equity. Calculate the cost of equity as rs = D1/Po + g. Do not round intermediate calculations. Round your answer to two decimal places. % b. Find Foust's WACC. Do not round intermediate calculations. Round your answer to two decimal places. %