The Patrick Company's year-end balance sheet is shown below. Its cost of common equity is 15.30%, its before-tax cost of debt is 7.30%, and its marginal tax rate is 35.00%. Assume that the firm's long-term debt sells at par value. The firm has 1,230 shares of common stock outstanding that sell for $7.30 per share. Calculate Patrick's WACC using market value weights. Assets Liabilities and Equity Cash 1,000 Accounts receivable 2,000 Inventories 8,000 Plant and equipment, net 7,000 Long-term debt 10,000 Common equity 20,000 Total liabilities and equity Total assets 12,000 20,000 10.327% 11.531% 11.078% 11.30096 12.100% Klose Outfitters Inc. believes that its optimal capital structure consists of 70% common equity and 30% debt, and its tax rate is 35%. Klose must raise additional capital to fund its upcoming expansion. The firm will have $300,000 of retained earnings with a cost of 15%. New common stock in an amount up to $6 million would have a cost of 20%. Furthermore, Klose can raise up to $250,000 of debt at an interest rate of 6% and an additional $6 million of debt at 8%. The CFO estimates that a proposed expansion would require an investment of $2,100,000. What is the WACC for the last dollar raised to complete the expansion? 8.10% 11.67% 12.06% 15,56%