Lovell Company purchased preferred stock in another company. The preferred stock's before-tax yield was 7.60%. The corporate tax rate is 25%. What is the after-tax return on the preferred stock, assuming a 50% dividend exclusion? (Round your final answer to two decimal places.)

a. 5.70%

b. 3.80%

c. 6.65%

d. 4.75%

e. 1.90%