Company D has a cost of equity capital of 14.0% and recently issued 8.0% debt, which currently trades at 104. Assuming the company has 40% equity in its capital structure and has a 40% marginal tax rate, what is its Weighted Average Cost of Capital (WACC)?
A) 8.4%
B) 10.2%
C) 10.4%
D) 11.0%
Answer: A