The market risk premium is 6%, the risk-free rate is 1.5%, and ABC Inc.'s beta is 0.9. The total debt ratio of ABC is kept at 40%, and the firm does not finance using preferred equity. The average yield to maturity on all bonds outstanding is 3.7%, and the corporate tax rate is 30%. With the cost of equity estimated using CAPM, which one comes closest to the WACC?

a. 4.93%

b. 6.11%

c. 6.42%

d. 5.62%

e. 5.18%