Question 9 (2.5 points) Consider the following scenario (the given information is the same as in the previous question): Suppose a company has 100 million common shares outstanding, and each share sells for $20. We have estimated that the shares have a beta of 1.25, the risk- free rate is 2%, and the expected market return is 6%. The marginal tax rate for this company is 35%. The company also has $1 billion of bonds outstanding and the yield to maturity on these bonds is 4%. The company has a target capital structure of 60% equity and 40% debt. It does not and will not issue preferred stocks in the future. Suppose the company has the flotation costs of 10% for equity and 6% for debt. What is the company's weighted average flotation cost? A) 6.0% B) 8.7% C) 10.0% D) 8.4%