This morning you purchased a stock that just paid an annual dividend of $3.90 per share. You require a return of 11.2 percent and the dividend will increase at an annual growth rate of 3.5 percent. If you sell this stock in three years, what will your capital gain be?

$5.70

$7.47

$4.60

$1.83

$3.50

Upton Umbrellas has a cost of equity of 12.1 percent, the YTM on the company's bonds is 6.2 percent, and the tax rate is 39 percent. The company's bonds sell for 103.7 percent of par. The debt has a book value of $423,000 and total assets have a book value of $957,000. If the market-to-book ratio is 2.89 times, what is the company's WACC?

5.62%

8.35%

10.26%

8.49%

9.96%