Verizon Communications is planning a $100 million expansion. This expansion will be financed, in part with debt issued with a coupon interest rate of 12%. Interest is paid annually. The bonds have a 12-year maturity and a $1000 face value, and they will be sold to net Verizon Communications $1080 after issue costs. Verizon Communications' marginal tax rate is 30%. Preferred stock will cost Verizon Communications 20% after tax. Verizon Communications' common stock pays a dividend of $10 per share. The current market price per share is $50, and new share can be sold to net $48 per share. Verizon Communications' dividends are expected to increase at an annual rate of 7% for the foreseeable future. Verizon Communications expects to have $15 million of retained earnings available to finance the expansion. Verizon Communications' target capital structure is as follows: Debt 50% Preferred Stock 15% Common Equity 35% Calculate the weighted average cost of capital that is appropriate to use in evaluating this expansion program. Question 17 options: 24.21% 22.59% 16.89% 18.51%