A firm is paying an annual preferred dividend of $3.63 per preferred share, and its preferred stock is selling for $62.70 per share. There is a selling cost of $3.30 per share when new preferred shares are sold by the firm to the public. What is the after tax cost of new preferred stock if the firm's tax rate is 33%?

Multiple Choice

• 5.79%

• 2.02%

• 6.11%

• 4.09%