Turnbull Co$.$ has a target capital structure of $58\%$ debt, $6\%$ preferred stock, and $36\%$ common equity. It has a before$-$tax cost of debt of $8\mathrm{.}2\%,$ and its cost of preferred stock is $9\mathrm{.}3\%.$

If Turnbull can raise all of its equity capital from retained earnings, its cost of common equity will be $12\mathrm{.}4\%.$ However, if it is necessary to raise new common equity, it will carry a cost of $14\mathrm{.}2\%.$

If its current tax rate is $25\%,$ how much higher will Turnbull$$s weighted average cost of capital $($WACC$)$ be if it has to raise additional common equity capital by issuing new common stock instead of raising the funds through retained earnings? $($Note: Round your intermediate calculations to two decimal places.$)$

$0\mathrm{.}85\%$

$0\mathrm{.}81\%$

$0\mathrm{.}75\%$

$0\mathrm{.}65\%$

Turnbull Co$.$ is considering a project that requires an initial investment of $$570,000.$ The firm will raise the $$570,000$ in capital by issuing $$230,000$ of debt at a before$-$tax cost of $9\mathrm{.}6\%,$ $$20,000$ of preferred stock at a cost of $10\mathrm{.}7\%,$ and $$320,000$ of equity at a cost of $13\mathrm{.}5\%.$ The firm faces a tax rate of $25\%.$ What will be the WACC for this project? $($Note: Round your intermediate calculations to three decimal places.$)$

Consider the case of Kuhn Co$.$

Kuhn Co$.$ is considering a new project that will require an initial investment of $$4$ million. It has a target capital structure of $58\%$ debt, $6\%$ preferred stock, and $36\%$ common equity. Kuhn has noncallable bonds outstanding that mature in $15$ years with a face value of $$1,000,$ an annual coupon rate of $11\%,$ and a market price of $$1555\mathrm{.}38.$ The yield on the company$$s current bonds is a good approximation of the yield on any new bonds that it issues. The company can sell shares of preferred stock that pay an annual dividend of $$9$ at a price of $$95\mathrm{.}70$ per share.

Kuhn does not have any retained earnings available to finance this project, so the firm will have to issue new common stock to help fund it$.$ Its common stock is currently selling for $$22\mathrm{.}35$ per share, and it is expected to pay a dividend of $$1\mathrm{.}36$ at the end of next year. Flotation costs will represent $3\%$ of the funds raised by issuing new common stock. The company is projected to grow at a constant rate of $8\mathrm{.}7\%,$ and they face a tax rate of $25\%.$ What will be the WACC for this project? $($Note: Round your intermediate calculations to two decimal places.$)$