The market value of Ford's equity, preferred stock, and debt are $7billion, $ 5 billion, and $ 10 billion respectively. Ford has a beta of 1.1, the market risk premium is 8%, and the risk-free rate of interest is 4%. Ford's preferred stock pays a dividend of $4 each year and trades at a price of $26 per share. Ford's debt trades with a yield to maturity of 8.5%. What is Ford's weighted average cost of capital if its tax rate is 25%?

A.

9.42%

B.

10.47%

C.

9.94%

D.

8.9%