Calculating Weighted Average Cost of Capital

    Calculating Weighted Average Cost of Capital (WACC)   put in an excel file Bogart Gaming Company (BGC) has the following capital structure, which it considers to be optimal: 2596 debt, 1596 preferred stock, and 6096 common stock BGC’s tax rate is 4096, and its investors expect dividends to grow at a constant rate of 696 in the future- BGC paid a dividend of $3.70 last year (DO) on its common stock, and the stock is currently priced at $60 per share. Debt can be sold at an interest rate of 996. New preferred stock could be sold to the public at a price of $100 per share with a dividend of $9, but flotation costs of $5 per share would be incurred. Only retained earnings will raise any new common equity. 1.Find the component costs of debt, preferred stock, and common stock 2.What is the Weighted Average Cost of Capital (WACC)? 3.In one paragraph, explain what WACC means- Why is it so important to estimate WACC correctly?