Question 3 (10 marks) (-) You are provided with the following information on Sparkle tad There are 60 million ordinary shares The shares will pay a dividend or 80 cents at the end of the year. The dividend is expected to grow at 2 pa indefinitely Sparkle's beta is 1.2. the risk-free rate is 46 The return on the market is 12% Sparkle has 1.5 milice bonds with a return of above the risk-free rate. The bonds are currently trading at SRS The company tax rate is 10% 2. Calcutane Sparkk Lid WACC Show all your workings. 7 marts) (b) Sunshine Land is in the same industry as Sparkle 1.ad but is located in a tropical res that othen faces flooding. Sunshine Ld is not a listed fim and it needs to calculates WACC. The CFO of Sunshine Indsays that they should we a Gifferent bet from Sparkled in their calculations because of their location Specifically, the frequent food make it more likely that Sunshine Lad's acts will be damaged explain what effect this looding should have on Sunshine Lit's beta (3 marks