You have collected the following information about a company:

Source of capital	Market value	Before-tax cost
Long-term debt	$160,000	8%
Preferred stock	$50,000	11%
Common equity	$450,000	15% for retained earnings 18% for new common stock
Total	$660,000

The company's total (federal plus state) marginal tax rate is 21%.

Part 1 What is the weighted average cost of capital, if all common equity comes from retained earnings?

Part 2 What is the weighted average cost of capital, if all common equity comes from newly issued stock?