Tortuga Industries is considering changing its capital structure. It currently has no debt and no preferred stock, but it would like to add some debt to take advantage of the tax shield. Its investment banker has indicated that the pre- tax cost of debt under various possible capital structures would be as follows: Market Debt-to- Market Equity-to- Before-Tax Cost of Value Ratio, wd Value Ratio, we Debt, rd 0.00 1.00 6.00% 0.10 0.90 6.40% 0.20 0.80 7.00% 0.30 0.70 8.20% 0.40 0.60 10.00% Tortuga uses CAPM to estimate its cost of common equity, re and at the time of the analysis the risk-free rate is 4%, the market risk premium is 6%, and the company's tax rate is 25%. The firm's estimated current beta, with no debt, is 0.90. Based on this information, what would be the weighted average cost of capital at the optimal capital structure? 9.000% 9.345% 9.3800% 9.275%