PLEASE SHOW ALL WORK:

Brutus Co. is a private company that has $10 million in debt outstanding. Brutus has 100 shares outstanding, and the last sale price for a share was $10,000. Brutus s credit rating would be similar to AA corporate bonds and their equity risk is similar to Buckeye Construction, a public firm with a beta of 1.75.

The risk-free rate is 2% and the market risk premium is 5%. The following are the yields of corporate bonds based on each credit rating.

Bond rating	Yield
AAA	4%
AA	5%
A	6%
BBB	7%
BB	8%
B	9%
CCC	10%

Assuming a corporate tax rate of 20%, what is Brutus's WACC?

Group of answer choices

No enough information

7.22%

5.52%

4.61%