Leo hired as a consultant to a company, the company target capital structure is 40% debt, 15% preferred, and 45% common equity. The after-tax cost of debt is 6.00%, the cost of preferred is 7.50%, and the cost of retained earnings is 12.50%. The firm will not be issuing any new stock. What is its WACC?

a. 10.98% b. 9.15% c. 7.59% d. 9.88% e. 11.16%