$R_E=\frac{D_1}{P_0}+g{P}_0\%\%$

$A_1=0_0(1+5)$

$=0\mathrm{.}60(1+0\mathrm{.}04)$

$0\mathrm{.}624$

Welling Inc. has a target debt $-$ equity ratio of $85.$ Its WACC is $9\mathrm{.}9\%,$ and the tax rate is $35\%.$

a$.[1$ marks$]$ If Welling's cost of equity is $14\%,$ what is its pre$-$tax cost of debt?

b$.[2$ marks$]$ If instead you know that the after$-$tax cost of debt is $6\mathrm{.}8\%,$ what is the cost of equity?

c$.[2$ mark$]$ If preferred equity has a same amount as debt, with $8\%$ cost$,$ what is debts pre$-$tax Cost