WACC calculations example: Desert Rose Cosmetics, Inc. (DRC) is a U.S. multinational company with the following debt and equity components in its consolidated capital section. DRC evaluates all its business decisions using the U.S. currency. Common shares are only listed on NYSE. Assumptions Tax Rate 15-year 4% Euro Bonds (euros) selling at par 10-year 6% Pound Bonds (pounds) selling at par Spot Rate ($/) Spot Rate ($/) Number of common share outstanding Stock price Stock beta Risk-free rate Market expected return Value 25.00% C. What is DRC's overall pre-tax cost of debt (ka)? d. What is the weight of debt financing in US$ (D/V)? e. What is DRC's WACC? 5,000,000 3,000,000 $1.25/ $1.40/ 2,000,000 $20/share 1.30 4% 10% a. What is DRC's cost of equity (ke)? b. What is the market value of DRC's total debt outstanding in US$ (D)?