In the box below explain the purpose of adding a buffer margin to establish the cutoff rate-what value does this add to decision making? Weighted average cost of capital: Source Bonds Stock Retained earnings Totals Proportion Cost Rate Weighted Cost 10% x 8% 30% 9% 0.80% 2.70% Bonds Weighted Cost provided for you 60% x 10% 6.00% 100% 9.50% How much is the Buffer Margin Percent the company requires What is the Cutoff rate for net present value analysis