Question: please solve and explain The company estimates that it cen issue debt at a rete of rt=11%, and its tax rate is 25%. it can
The company estimates that it cen issue debt at a rete of rt=11%, and its tax rate is 25%. it can issue preterted stock that pays a constant dividend of \$4.00 per year at \$54.00 per share. Also, its common stock currently sells for $42,00 per share; the next expected dividend, D constant rate of 6% per year. The target cepital structure consists of 75% commen stock, 15\% debt, and 10% preferred stock. a. What is the cost of each of the capital components? Do not round intermediate calcidations. Round your answers to two dedinal places; Cost of debt: Cost of preferred stock: Cost of retained earningtrz b. What is Adamson's WACC? Do not round interreediate calculotions. Reund your answer to two decimal piaces. c. Ority projects with expected retarns that exceed WaCC will be accepted. Which projects should Aifamson accept? Project 1 Project 2 Project
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