Question 1640 marks) The CEO of Netfly Company Limited. Mr Chathastread an article that was published in the HKEJ in which the author argued that finding the overall cost of capital of a company would and valuation but the cost of capital mas k for most of the firmadesto He presents this information to the senior management of the company and they also agree that this important information is also linked to the compte peal of shareholder's wealth maximization. As such, the company needs to dete c ost of capital Kiki, a fresh graduate of the CUHK Business School has just been appointed as a Finance Associate a Natty Lad to participate in the protec t the cost of capital of the company and help the Board of Directors to stand the importance and implication of the cost of capital in achieving the corporate goal Kiki's priser passed her with the following information extracted from Netfly's financial statements at 31 December 2019: 8.960 4725 Equity and lates Ordinary Share nominal values so) 5% Preference are nominal value $1.5) Share premium Retained carnings Total equity 47,712 Noncurrat Ilahilities S.ON coupon bonds 35.840 Current liabilities Total Equity and Liabilities 11.648 94300 Additional information is provided as well: The ordinary shares are trading at $3.78 per share and the dividend paid was 50.75 per share. In recent years, dividends have grown at a rate of per annum and the market anticipates that the growth rate will be able to maintain in the foreseeable future. The beta of the outstanding ordinary shares is 145 The current market price for preference shares is $1.per share. The company issued 20-year bonds at a coupon rate of 5.08% with semi-ammal payment three years ago The par value of the bonds issued is $1,000 and the current required rate of return for bonds of similar risk and maturity in the market is 3.23%. The company is in the corporation tax bracket of Most recently, overall return on Hang Seng Index is 16% per annum with 45% annual risk-free rate of return Page of Osesti Licent Required: a) Calculate the cost of equity answer (5 marks) b) Calculate the cost of preference share answer in (2 marks) (3 marks) c) Determine the bond price today, laser in 2 decimal places d) Calculate the weighted average cost of capital (WACC) of the company answer in (10 marks)