Please answer questions l$,$ m and n below:

In recent years, EVBOLT Industries has faced challenges due to the high cost of capital, limiting its ability to undertake significant capital investments. However, with a recent decline in capital costs, the company is now considering a substantial expansion program proposed by the marketing department. As an assistant to Leigh Jones, the financial vice president, your initial task is to estimate EVBOLT's cost of capital. Jones has provided relevant data for this task:

$(1)$ The firm's tax rate is $40\%.$

$(2)$ The current price of EVBOLT's $12\%$ coupon, semiannual payment, noncallable bonds with $15$ years remaining to maturity is $$1,153\mathrm{.}72.$ The company does not use short$-$term interest$-$bearing debt on a permanent basis, and new bonds would be privately placed with no flotation cost.

$(3)$ The current price of the firm's $10\%,$ $$100$ par value, quarterly dividend, perpetual preferred stock is $$116\mathrm{.}95.$ Flotation costs equal to $5\%$ of the proceeds would be incurred on a new issue.

$(4)$ EVBOLT's common stock is currently priced at $$50$ per share. Its last dividend $($Do$)$ was $$3\mathrm{.}12,$ and dividends are expected to grow at a constant rate of $5\mathrm{.}8\%.$ The company's beta is $1\mathrm{.}2,$ the yield on T$-$bonds is $5\mathrm{.}6\%,$ and the market risk premium is estimated at $6\%.$ For the own$-$bond$-$yield$-$plus$-$judgmental$-$risk$-$premium approach, the firm uses a $3\mathrm{.}2\%$ risk premium.

$(5)$ EVBOLT's target capital structure is $30\%$ long$-$term debt, $10\%$ preferred stock, and $60\%$ common equity.

Leigh Jones has outlined specific questions to guide the analysis:

l$.$ Explain in words why new common stock that is raised externally has a higher percentage cost than equity raised internally by retaining earnings.

m$.(1)$ EVBOLT estimates that if it issues new common stock, the flotation cost will be $15\%.$ EVBOLT incorporates the flotation costs into the DCF approach. What is the estimated cost of newly issued common stock, taking into account the flotation cost? $(2)$ Suppose EVBOLT issues $30-$year debt with a par value of $$1,000$ and a coupon rate of $10\%,$ paid annually. If flotation costs are $2\%,$ what is the after$-$tax cost of debt for the new bond issue?

n$.$ What four common mistakes in estimating the WACC should EVBOLT avoid?