1. Patrick Corporation has a target capital structure of 40 percent common stock, 15 percent preferred stock, and 45 percent debt. Its cost of equity is 15 percent, the cost of preferred stock is 7 percent, and the cost of debt is 8 percent. The relevant tax rate is 40 percent. What is Patricks WACC?

1. 8.93%
2. 9.21%
3. 10.00%
4. 10.65%