The Anson Jackson Court Company $($AJC$)$ currently has $$200,000$ market value $($and book value$)$ of perpetual debt outstanding carrying a coupon rate of $6\%.$ Its earnings before interest and taxes $($EBIT$)$ are $$100,000,$ and it is a zero growth company. AJC's current cost of equity is $8\mathrm{.}8\%,$ and its tax rate is $40\%.$ The firm has $10,000$ shares of common stock outstanding selling at a price per share of $$60\mathrm{.}00.$

Refer to the data for the Anson Jackson Court Company $($AJC$).$ The firm is considering moving to a capital structure that is comprised of $30\%$ debt and $70\%$ equity, based on market values. The new funds would be used to replace the old debt and to repurchase stock. It is estimated that the increase in risk resulting from the additional leverage would cause the required rate of return on debt to rise to $7\mathrm{.}5\%,$ while the required rate of return on equity would rise to $9\mathrm{.}5\%.$ If this plan were carried out, what would be AJC's new WACC and total value?

a$.$

$8\mathrm{.}00\%$; $$750,000$

b$.$

$7\mathrm{.}50\%$; $$800,000$

c$.$

$7\mathrm{.}50\%$; $$750,000$

d$.$

$7\mathrm{.}38\%$; $$813,008$

e$.$

$7\mathrm{.}80\%$; $$800,000$