Consider the following information for Watson Power Co.:

Debt:		3,000 5.5 percent coupon bonds outstanding, $1,000 par value, 23 years to maturity, selling for 102 percent of par; the bonds make semiannual payments.
Common stock:		72,000 shares outstanding, selling for $60 per share; the beta is 1.1.
Preferred stock:		9,000 shares of 4 percent preferred stock outstanding, currently selling for $105 per share.
Market:		6.5 percent market risk premium and 3.5 percent risk-free rate.

Assume the company's tax rate is 33 percent.

Find the WACC.

a- 7.33%

b- 7.92%

c- 7.68%

d- 7.18%

e- 7.28%