c. Suppose the firm can increase its debt so that its capital structure has 50% debt,based on market values (it will issue debt and buy back stock). At this level ofdebt, its cost of equity rises to 18.5% and its interest rate on all debt will rise to12% (it will have to call and refund the old debt). What is the WACC under thiscapital structure? What is the total value? How much debt will it issue, and whatis the stock price after the repurchase? How many shares will remain outstandingafter the repurchase?