Question: Can someone explain this please. Step by step for both questions if its possible thank you so much. 2.) Joes pizza has 18 million shares

Can someone explain this please. Step by step for both questions if its possible thank you so much.

2.) Joes pizza has 18 million shares outstanding with a stock price of $26 per share. Joes also has $140 million in bonds outstanding. The bonds currently trade at their par value of $1,000 and carry coupon interest of 4.433%. Joes corporate tax rate is 25%. Joes equity beta is 1.2, the Rf = 3.5% and the return on the market = 7.5%. a. What is Joe unlevered cost of capital? b. What is Joes pre tax and after tax cost of debt? c. What is Joes WACC?

3.) Bobs auto shop is expanding into hamburger restaurants and has identified McDonalds as a comparable company in this area. Suppose McDonalds has an equity market capitalization of $400 billion and a beta of .83. McDonalds also has $86 billion of AAA rated debt outstanding with a yield to maturity of 3.6%. Assume Rf = 3.5% and the MRP = 4%. Further assume that McDonalds debt beta = 0. a. What is McDonalds asset (unlevered) cost of capital? b. What is McDonalds unlevered beta?

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