Schadler Systems is expected to pay a $2.00 dividend at year-end (D₁), the dividend is expected to grow at a constant rate of 6.00% a year, and the common stock currently sells for $53.00 a share. The before-tax cost of debt is 4.50%, and the tax rate is 50%. The target capital structure consists of 41% debt and 59% common equity. What is the companys WACC if all equity is from retained earnings?

	a.	6.69%
	b.	7.11%
	c.	3.81%
	d.	7.61%