1. Calculate WACC given the following information.

Total Value of Common Stocks (CS)	$600,000	Cost of Equity (common stocks)	0.22
Total Value of Preferred Stocks (PS)	$100,000	Cost of Preferred stock	0.14
Total Value of Debt (D)	$500,000	Pre-tax Cost of Debt	0.07
		Tax rate (t)	0.2

14.50%

8.16%

none of the answers is correct

16.31%

12.01%