Relaxing Suites Corp. has a debt-to-equity ratio of 1.5. The corporations common stock is trading at $90 per share and expects to pay an annual dividend of $6.75 per share next year. The dividends are expected to grow at 4 percent annually. In addition, the corporation has bonds outstanding that are currently priced at par. The 12-year, 3.5% coupon bonds pay interest semiannually and have a $1,000 face value. Assume the corporate tax rate is 21 percent. What is the corporations weighted average cost of capital? (5 points)

A. 3.50 percent

B. 9.65 percent

C. 6.25 percent

D. 11.80 percent

E. 8.01 percent