Imagine you are the CFO of IBM. You have been successful over the years but are

Imagine you are the CFO of IBM. You have been successful over the years but are now concerned about how many sources of funds you have and the cost of those funds. With changing business conditions you really want to keep these costs down. At IBM you have issued $100000000 in Corporate Bonds that carry a 6% interest rate $200000000 in Equity that offers a 10% dividend and $100000000 in Retained Earnings that has an opportunity cost of 9%.
a. What is your weighted average cost of capital? (Calculate and show the work)
b. What could this business do to bring this cost down? Discuss using specific examples.
c. Why is knowing WACC important for a business?