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Management of the SoSadItIsOver Company needs to determine itscost of capital in order to evaluate some large capital purchases.The company's bonds have a yield to maturity of 6%, last dividendpaid on common stock was $2.16 per share, current stock price is$47/share, and constant growth of 5% is expected on dividends andearnings. The company's capital structure is 30% debt, 70% equity.There is no preferred stock and the marginal tax rate is21%.   SHOW ALL WORK.
a) 2 pts. What is the after-tax cost of debt?
b) 4 pts. What is the cost of equity?
c) 6 pts. What is the company's cost of capital (WACC)?
