The following problem will be used to answer the next five questions. The Doug and Bob Corporation is calculating its WACC. Its 2,000,000 bonds have a 4% coupon, paid semi-annually, a current maturity of 30 years, and sell for a quoted price of 90. The firm's 2,800,000 shares of preferred stock (par $100) pays a 5.5% annual dividend and currently sells for $93. Doug and Bob is a constant growth firm which just paid a dividend of $1.50 (Do), sells for $20.00 per share; it has 180,000,000 shares outstanding, and the common stock has an estimated growth rate of 8%. The firm's beta is 1.9, and the firm's marginal tax rate is 20%. The historic market return 11% and the risk free rate is 4.5%, 19. What is the firm's after-tax cost of equity financing if we use the discounted cash flow approach (Gordon Growth model)? a) 16.85% b) 16.10%** C) 15.50% 12.88% 25.40% 20. What is the weight of debt in Doug and Bob's capital structure (approximately)? a) 35.3% b 30.9% C) 26.8% 31.8%** e) 4.5%