A firm has an initial debt-to-capital ratio of 10% and is planning to get rid of all of its debt. The tax rate is 30% and the firm's initial pre-tax cost of debt is equal to 5%. What is the firm's cost of capital without any debt if its initial cost of capital is equal to 10%, the market risk premium is equal to 5%, and the risk-free rate is equal to 2%?

10%

14%

12%

16%

15%