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Buray Corporation, whose target capital structure is 30% debt, 10% preferred, and 60% common equity,...

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Buray Corporation, whose target capital structure is 30% debt, 10% preferred, and 60% common equity, is calculating its cost of capital for capital budgeting purposes. Buray has 1.2 Beta, risk free rate is 4% in the market and market risk premium is 5%. The before-tax cost of debt is 10%, and the tax rate is 30%. Its preferred stock has been paying $5 dividend per year and its current market price is $70. What is the company's WACC if all the equity used is from retained earnings? 14.34% 6.4% 9.43% 8.81%

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