Toyota has 30 million shares outstanding with a price of $15 per share. In addition, Toyota has issued bonds with a total current market value of $150 million.

1. Suppose Toyota s equity cost of capital is 10%, and its debt cost of capital is 5%. What is Toyotas pretax weighted average cost of capital?

(Form the result in decimals, not percentiles, and round the result to the third decimal place, if necessary. For example, if your answer is 13.42%, write 0.134.))

2. Now, suppose that Toyotas equity cost of capital is 11%, and its debt cost of capital is 5%. If Toyotas corporate tax rate is 35%, what is its after-tax weighted average cost of capital?