Highland Manufacturings unlevered cost of capital is 25 percent, its expected earnings before interest and taxes is $68,500 and its tax rate is 40 percent. The company has debt with both a face value and a market value of $40,000. This debt has a coupon rate of 10 percent and pays interest annually. What is the weighted average cost of capital of this levered firm?

A. 17.50%

B. 20.79%

C. 22.78%

D. 23.67%

E. No enough information to determine