The Simon Company (SIMON) currently has $300,000 market value (and book value) of perpetual debt outstanding carrying a coupon rate of 6%. Its earnings before interest and taxes (EBIT) are $150,000, and it is a zero growth company. SIMON's current cost of equity is 8.8%, and its tax rate is 40%. The firm has 10,000 shares of common stock outstanding selling at a price per share of $90.00.What is SIMON's current total market value and weighted average cost of capital?

A.

$720,000; 9.2%

B.

$1,200,000; 7.5%

C.

$600,000; 5.7%

D.

$800,000; 7.5%