A firm's common stock currently sells for $30.00 per share and last year's dividend was $.90. This dividend is expected to grow by 10% annually. If new common stock is issued, the firm will pay $1.80 per share in floatation costs. What is the firm's cost of capital for new common stock?

a. 12.4%

b. 13.2%

c. 13.5%

d. 14.6%