You run a company that sets up holiday events (e.g. mall Santas, Easter egg hunts, etc.). The book value of your debt is $150,000, which also happens to be the market value. The coupon rate of debt is 4% and the yield to maturity of debt is 4.5%. The book value of equity is $150,000 while the market value is $450,000. You calculate the equity beta to be 1.2. The risk-free rate is currently 1% and the expected market return is 11%. All market information carries through the entirety of the problem. a. Calculate the cost of capital for your business b. If you decide to issue more debt to buy back shares (decrease equity), how would you expect the cost of debt and the cost of equity to change (in a general sense, not magnitudes)? Use one sentence. e. You've seen a lot of news about Elon Musk lately and decide to throw your hat into the commercial space expedition business. You decide to model the business structure after Blue Origin, a firm with an equity Beta of 0.6, a debt Beta of 0.1, and a capital structure that is 50% debt and 50% equity. You calculate that you would need to invest $1B today and then you would accrue $100 million per year into perpetuity (first payment one year from today). Given this information and taking into account your other business to the extent necessary), should you proceed with the space exploration project