Use the below information for this problem
Debt rating		AAA	AA	A	BBB	BB	B	CCC
Average Debt Beta		0.05	0.05	0.05	0.1	0.17	0.26	0.31
Company		Market value of equity($m)	Market value of debt($m)	Equity Beta	Debt Rating	Coupon rate of bonds	YTM of Bonds	Tax Rate
Strive		$4,500	$3,500	1.2	CCC	6%	5.20%	21%
Suppose the risk-free is 1.1% and expected market risks premium is 5%. The effective cost of debt for Strive Corp. is ..........%. Round you answer to nearest one decimal place.
Please give a step-by-step explanation.
As a financial manager for your firm ABC Corp, you estimated the cost of equity under different mixes of debt and equity(also called capital structure).
Assume ABC faces a tax rate of 21%. Determine which one of the following capital structures has the lowest WACC. Eg. in capital structure 1,( net deb+equity)=0%, equity/(net debt+equity)100%;
in capital structure 2, net debt/(net debt+equity)=20%, equity/(net debt+equity)=80%
Capital	Net	Equity	Cost of Debt	Cost of Equity
structure	Debt
1	0%	100%	3%	12%
2	20%	80%	5%	14%
3	30%	70%	6%	15%
4	40%	60%	8%	18%
Please give a step-by-ste explaination