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Please show full work if possible, would like to be able tounderstand the problem and solution.Lion Inc. recently hire you as a consultant to estimate thecompany’s WACC. You haveobtained the following information.(1) The firm’s noncallable bonds mature in 20 years, have an 8%annual coupon, a parvalue of $1,000, and a market price of $1,050.(2) The company’s tax rate is 40%.(3) The risk-free rate is 4.50% and the market risk premium is5.50%. The stock has abeta of 1.20.(4) The target capital structure consists of 35% debt and theremainder is commonstock.(5) The firm uses the CAPM to estimate the cost of equity, andit does not expect toissue any new common stock.Please identify the company’s WACCA. 7.16%B. 7.54%C. 7.93%D. 8.35%E. 8.79%