WACC and optimal capital budget Adamson Corporation is considering four average-risk projects with the following costs and rates of return: The company estimates that it can issue debt at a rate of rd = 11%, and its tax rate is 30%. It can issue preferred stock that pays a constant dividend of $5 per year at $57 per share. Also, its common stock currently sells for $38 per share; the next expected dividend, D_1, is $4.50; and the dividend is expected to grow at a constant rate of 5% per year. The target capital structure consists of 75% common stock, 15% debt, and 10% preferred stock. What is the cost of each of the capital components? Round your answers to two decimal places. Do not round your intermediate calculations. Cost of debt _ % Cost of preferred stock _ % Cost of retained earnings _ % What is Adamson's WACC? Do not round your intermediate calculations. _ % Only projects with expected returns that exceed WACC will be accepted. Which projects should Adamson accept? Project 1 - Project 2-- Project 3--- Project4