Your consultant firm has been hired by Eco Brothers Inc. to help them estimate the cost of common equity. The yield on the firm's bonds is 8.55%, and your firm's economists believe that the cost of common can be estimated using a risk premium of 3.65% over a firm's own cost of debt. What is an estimate of the firm's cost of common from retained earnings based on the own-bond yield estimation?

a. 12.20%

b. 13.10%

c. 13.63%

d. 14.17%

e. 14.74%