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3. Dobson Dairies has a capital structure which consists of 60 percent long-term debt and 40 percent common stock. The company's CFO has obtained the following information: The before-tax yield to maturity on the company's bonds is 8 percent. The company's common stock is expected to pay a $3.00 dividend at year end (D, $3.00), and the dividend is expected to grow at a constant rate of 7 percent a year. The common stock currently sells for $60 a share. Assume the firm will be able to use retained earnings to fund the equity portion of its capital budget. The company's tax rate is 40 percent. . What is the company's weighted average cost of capital (WACC)? a. 12.00% b. 8.03% c. 9.34% d. 8.00% e. 7.68%