Here is the condensed 2021 balance sheet for Skye Computer Company (in thousands of dollars): Skye's earnings per share last year were $2.65. The common stock sells for $60.00, last year's dividend (00) was $1.75, and a flotation cost of 114$ would be required to sell new common stock security analysts are projecting that the common dividend will grow at an annual rate of 104 . Skye's preferred stock pays a dividend of $2.75 per share, and its preferred stock selis for $25.00 per share. The firm's before-tax cost of decot is 11 sh, and its marginal tax rate is 25%. The firm's currently outstanding 11W anmual coupon rate, long-term debt selis at par value, The market risk premium is ofl. the risk-free rate is 7%, and 5kye 's beta is 1.234 . The firm's total debt, which is the sum of the company's short-term debt and leng-term debt, equals \$1.05 miluion. The data has been collected in the Microsoft Excel file below. Download the spreadsheet and perform the required aralvis to anawer the quentions below. Do not round intermediate calculations. found your answers to two decimal places. a. Calculate the cost of each capital component, that is, the after-tax cost of debt, the cost of preferred stock, the cost of equity from retained earnings, and the cost of newly issued common stock. Use the DCF method to find the cost of common equity. After-tax cost of debt: 5% Cost of preferred stock: 8% Cost of retained earnings: 8% Cost of new common stock: 6% b. Now calculate the cost of common equity from retained earnings, using the CAPM method. C. What is the cost of new common stock based on the CAPM? (Hint: Find the difference between r0 and rs as determined by the DCF method, and add that differential to the CAPM value for rs) 8% 4. If Skye continues to use the same market-value capital structure, what is the firm's WACC assuming that ( 1 ) it uses only retained earnings for equity and (2) if it expands so rapidly that it must issue new commen stock? (Hint: Use the market value capital structure excluding current liabilities to determine the weights. Also, use the simple average of the required values obtained under the two methods in caiculating WACC. WACC 1 : 8 WACC 2 : 6%