Consider the following information for Watson Power Company:

Debt: $5,5006\mathrm{.}5$ percent coupon bonds outstanding, $$1,000$ par value, $18$ years to maturity, selling for $103$ percent of par; the bonds make semiannual payments.

Common stock: $132,000$ shares outstanding, selling for $$55$ per share; the beta is $1\mathrm{.}07.$

Preferred stock: $18,500$ shares of $6$ percent preferred stock outstanding, currently selling for $$105$ per share.

Market: $7$ percent market risk premium and $5\mathrm{.}5$ percent risk$-$free rate.

Assume the company's tax rate is $34$ percent.

Find the WACC.

Multiple Choice

$8\mathrm{.}75\%$

$9\mathrm{.}46\%$

$8\mathrm{.}65\%$

$9\mathrm{.}05\%$

$8\mathrm{.}55\%$