Dolphin Company is financed by $2 million in debt, $1 million in preferred stocks, and $7 million in common stocks. The pre-tax cost of debt is 4%, the cost of preferred stock is 6%, and the cost of equity is 12%. Calculate the weighted average cost of capital. Assume 21% tax rate.

a. 6.29%

b. 9.63%

c. 7.60%

d. 8.26%