Cost of Debt question (EOC)

CFA Level I Corporate Finance
#1

This is EOC question from CFAI on cost of capital.

[question removed by admin]

I am not able to understand the approach to solve it. Correct is A. Can someone please help. The solution given in the book says: [answer removed by admin] Why we are not taking into consideration the 9 % earlier coupon rate and the earlier debt issued?

#2

In calculating the WACC, you use the marginal cost (the cost of the next dollar borrowed). These funds are likely to be used in financing their next project(s), and therefore the marginal WACC is the appropriate discount rate to use, particularly when determining the NPV of that/those project(s).

Your question is likely to be deleted by the admins for copyright violations, FYI.

#3

You’re a physic.