Q#11 The balance sheet data for SBG Associates are as follows (in m Assets Liabilities and Shareholders' Equity Assets $750 Debt Equity (6 million shares) $250 500 $750 $750 The shareholders now require a 20 percent return on their capital. The bonds are now yielding 14 percent (yield-to-maturity). The corporate tax rate is 35%. 11(a) What is SBG's after-tax cost of debt? (5pts) Show your work below (A) 14% (B) 20% (C) 9% 11(b) What is SBG's cost of capital (WACC)? (5 pts) (A) 14% Show your work below (B) 20% (C) 9.1 % (D) 16.4% (E) 15.4%

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