A $10,000,000 real estate investment is financed with $8,000,000 in debt at an annual 5% interest rate (kd) and $2,000,000 in equity at an annual 10% cost of equity (ke) the tax rate (t) is 25%. this investment Arditti-Levy method weighted (overall) average cost capital is

a) 7.5%

b) 5%

c) 6%

d) cannot determine without knowing principal payment debt