The following problem will be used to answer the next question.

The Doug and Bob Corporation is calculating its WACC. Its $200,000$ bonds have a $5\%$ coupon, paid semi$-$annually, a current maturity of $30$ years, and sell for a quoted price of $105.$ The firm's $400,000$ shares of preferred stock $($par $$100)$ pays a $6\mathrm{.}5\%$ annual dividend and currently sells for $$90.$ Doug and Bob is a constant growth firm which just paid a dividend of $$2\mathrm{.}00(D_0),$ sells for $$40\mathrm{.}00$ per share; it has

$19,000,000$ shares outstanding, and the common stock has an estimated growth rate of $9\%.$ The firm's beta is $1\mathrm{.}5,$ and the firm's marginal tax rate is $20\%.$ The return on the market is $12\%$ and the risk free rate is $5\%.$

What is the firm's after$-$tax cost of equity financing if we use the SML$?$

$15\mathrm{.}5\%$

$14\mathrm{.}5\%$

$14\mathrm{.}1\%$