What must a firm do to lower the weighted average of cost of capital? Trade off the value of the interest tax shield on debt and the risk of financial distress "Take on as little debt as possible, as it is easier to fund a company with equity" Optimize its investment decision-making Take on as much debt as possible because it is cheaper than equity and will lower the WACC automatically QUESTION 13 "ABC Company can sell common shares at $30 per share and can obtain debt funding at 8 percent, It has a marginal income tax rate of 25 percent. The yield on US Treasury securities is 3 percent. The market risk premium is 6.0 percent, and the firm s beta is 0.9 . It has a targeted debt-to-equity ratio of 1:1. What is its after-tax cost of debt? Enter vour answer in whole numbers rounded to two decimal places if necessary