YouWork is financed with 40% debt, 50% equity, and 10% preferred stocks. YouWork's current dividend is $4 and it is expected to grow at a rate of 4% each year. The stock price for YouWork is $40. YouWork has $400 million in retained earnings that can be used as a source of internal equity financing. Any equity capital more than $400 million needs to be sourced with issuance of external equity at net proceeds of $38. YouWork can borrow up to $300 million from a local bank at the before-tax rate of 7%. To raise more debt, YouWork has to issue a 10-year bond with a coupon rate of 8% at net proceeds of $920 per $1,000 face value. YouWork's preferred stock pays constant dividend of $3 and is priced at $31. YouWork's preferred stock has a $1 issuance cost. Lastly, YouWork's tax rate is 35%.

At what point of financing does YouWork run out of retained earnings?

Group of answer choices

$800 million

$1,000 million

$900 million