ABC Co. has 40% debt and 60% equity, as optimal capital structure. Their stock price is 50$, last dividend distributed was $4.2 , growth rate is expected %5, corporate tax rate is 20% and flotation costs are 5%. They can borrow at 10% rate up to $15 million, above which interest rises to 12%. But if they borrow $25 million or more, interest once again rises to 14%. Their expected net income for next year is $33,6 millions, and 45% will be distributed as dividends.

a) Calculate component costs, and break point(s).

b) Calculates WACC's.

c) What is minimum acceptable return for any project undertake?