WACC and Optimal Capital Structure Pierce Products Inc. is considering changing its capital structure. Pierce currently has no debt and no preferred stock, but it would like to add some debt to take advantage of low interest rates and 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 Market Equity Market Debt to-Value to-Value to-Equity Ratio Ratio Ratio (wa) (w.) (D/S) Before Tax Cost of Debt (ra) 0.0 10 0.00 6.09 0.2 0.0 0.25 7.0 0.4 0.6 0.67 3.0 0.6 0.4 1.50 9.0 0.0 0.2 4.00 10.0 * Use the exact value of 2/3 in your calevations Parce uses the CAPM to estimate its cost of common equity and at the time of the analysis the risk free rate is the market risk premium is 5, and the company tax ratelow. Plerce states that its beta now (which is unlevered because it currently has no debt) 1.1. Based on this information, what is the firm's optimal capital structure, and what would be the welehted average cost of capital at the aptimal capital structure? Do not found intermediate calculation. Hound your answers to two decimal places Det WACC Check Sty Work mining