22. Cutler Corporation has a target capital structure of 45 percent common stock, 5 percent preferred stock, and 50 percent debt. Its cost of equity is 8 percent, the cost of preferred stock is 6.5 percent, and the cost of debt is 18 percent. The relevant tax rate is 35 percent. What is Cutlers WACC?

1. 6.85%
2. 12.50%

c 9.68%

d. 7.34%