Loring Inc. is expected to pay a $2.80 dividend at the end of the year, the dividend is expected to grow at a constant rate of 8% per year, and the common stock currently sells for $50 a share. The before-tax cost of debt is 6% and the corporate tax rate is 40%. The target capital structure consists of 30% debt and 70% equity. What is the companys weighted average cost of capital (WACC) if all the equity used is from retained earnings?

10.82%

10.60%

11.32%

11.55%

None of the above.