Jones Company has a target capital structure of 40% debt, 10% preferred stock, and 50% common equity. The companys after tax cost of debt is 8%, its cost of preferred debt is 10%, its cost of retained earnings is 14%, and its cost of new common stock is 16%. The company stock has a beta of 1.2 and the companys marginal tax rate is 35%. What is the companys weighted average cost of capital if retained earnings are used to fund the common equity portion?

A. 11.20%

B. 6.72%

C. 8.00%

D: 16.80%