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To estimate the company's WACC, Marshall Inc. recently hiredyou as a consultant. You have obtained the followinginformation.(1) The firm's existing noncallablebonds which mature in 40 years, have an 5.00% annual coupon, a parvalue of $1,000, and a market price of $950. You have done someresearch and estimate the cost of issuing additional debt wouldcost you similarly to the existing bonds.(2) The company's current tax rate is40%, but the tax rate is estimated to go up to 35% very soon.(3) The projected future risk-freerate is 2.50%. The market return is predicted to be 7.50%. Thestock's historical beta is 1.52, as some uncertainty resolved, it’sexpected to decrease to 1.20.(4) The target capital structureconsists of 25% debt and the balance is common equity. While basedon the book value, debt accounts for 10% and equity accounts for90%.The firm uses CAPM to estimate thecost of common stock, and it does not expect to issue any newshares.What is its WACC given all aboveinformation?