(solution) Reactive Industries has the following capital structure. Its

(solution) Reactive Industries has the following capital structure. Its

Reactive Industries has the following capital structure. Its corporate tax rate is 35%

SECURITY                               MARKET VALUE                              REQUIRED RATE OF RETURN

Debt                                          $20 Million                                           6%

Preferred Stock                       $30 Million                                          8%

Common Stock                        $50 Million                                          12%

What is the WACC?

Debt
PS
CS 20
30
50
100 0.039
0.08
0.12 0.0078
0.024
0.06
9.18% WACC