Weston Enterprises is an all$-$equity firm with two divisions. The soft drink division has an asset beta of $0\mathrm{.}52,$

expects to generate free cash flow of $$49$ million this year, and anticipates a $4\%$ perpetual growth rate. The

industrial chemicals division has an asset beta of $1\mathrm{.}09,$ expects to generate free cash flow of $$74$ million this

year, and anticipates a $3\%$ perpetual growth rate. Suppose the risk$-$free rate is $2\%$ and the market risk premium

is $5\%.$

a$.$ Estimate the value of each division.

b$.$ Estimate Weston's current equity beta

c$.$ Estimate Weston's current cost of capital. Is this cost of capital useful for valuing Weston's projects? How is

Weston's equity beta likely to change over time?

a$.$ Estimate the value of each division.

The cost of capital for the soft drink division is

$\%.($Round to two decimal places.$)$