Suppose That TNT, Inc

Multiple Choice

Suppose that TNT, Inc. has a capital structure of 43 percent equity, 23 percent preferred stock, and 34 percent debt. If the before-tax component costs of equity, preferred stock and debt are 15.4 percent, 10 percent and 7 percent, respectively, what is TNT's WACC if the firm faces an average tax rate of 28%?

A) 9.45%
B) 10.64%
C) 10.80%
D) 11.30%