Wyden Brothers has no retained earnings. The company uses the CAPM to calculate the cost of equity capital. The companys capital structure consists of common stock, preferred stock and debt. Which of the following events will increase the companys WACC?

a. An increase in the firms marginal tax rate.

b. A decrease in the companys beta.

c. An increase in the market risk premium.

d. A decrease in expected inflation.

e. A decrease in the floatation costs associated with issuing new common stock.