XYX corporations capital structure calls for 60% debt and 40% common equity. The companys cost of debt is 8%. Retained earnings are estimated to be $160 million. The companys cost of retained earnings is 14% and the cost of external common equity is 16%. The corporate tax rate is 30%. Calculate the WACC below the RE break point.

Group of answer choices

5.96%

6.96%

7.96%

8.96%