The objective of this exercise is to estimate Targets weighted average cost of capital (WACC) by utilizing the below. The questions below are required to complete the entire analysis of WACC comprehensively with consideration of costs of the equity and debt capital.

Estimate the cost of equity using CAPM. Support your choice with succinct details incorporating all inputs in the CAPM including the market risk premium

Estimate the cost of debt using the commonly known method known as the Spread approach.

Estimate the following capital structure ratios, where value (V) = equity (E) + debt (D). Show all calculations

a) Equity-to-value (E/V)

b) Debt-to-value (D/V)

What is your resulting WACC incorporating the costs of the equity and debt capital Target uses? Show all calculations