rate is $\backslash (32\backslash \%\backslash ).$ WestGas finds that it can finance in the domestic U$.$S$.$ capital market at the rates listed in the popup window: Both debt and equity would have to be sold in multiples of $\backslash (\backslash$$ $20\backslash )$ million, and these cost figures show the component costs, each, of debt and equity if equity financing.

a$.$ Calculate the lowest average cost of capital for each increment of $\backslash (\backslash$$ $40\backslash )$ million of new capital, where WestGas raises $\backslash (\backslash$$ $20\backslash )$ million in the equity market and an additional $\backslash (\backslash$$ $20\backslash )$ in the debt market at the same time.

b$.$ If WestGas plans an expansion of only $\backslash (\backslash$$ $60\backslash )$ million, how should that expansion be financed?

c$.$ What will be the weighted average cost of capital for the expansion?

a$.$ If WestGas plans an expansion of $\backslash (\backslash$$ $120\backslash )$ million, what is the lowest average cost of capital for the first $\backslash (\backslash$$ $40\backslash )$ million of new capital?

$\backslash \%($Round to two decimal places.$)($Click on the following icon in order to copy its contents into a spreadsheet.$)$

$\backslash$begin$\{$tabular$\}\{|$l$|$l$|$l$|$l$|$l$|\}$

$\backslash$hline Costs of Raising Capital in the Market & Cost of Domestic Equity & Cost of Domestic Debt & Cost of European Equity & Cost of European Debt $\backslash \backslash$

$\backslash$hline Up to $\backslash$$$40$ million of new capital & $11\backslash \%$ & $7\backslash \%$ & $12\backslash \%$ & $6\backslash \%\backslash \backslash$

$\backslash$hline $\backslash$$$41$ million to $\backslash$$$80$ million of new capital & $19\backslash \%$ & $13\backslash \%$ & $17\backslash \%$ & $12\backslash \%\backslash \backslash$

$\backslash$hline Above $\backslash$$$80$ million & $22\backslash \%$ & $17\backslash \%$ & $24\backslash \%$ & $18\backslash \%\backslash \backslash$

$\backslash$hline

$\backslash$end$\{$tabular$\}$