The capital structure for a firm is $29\%$ debt, $20\%$ preferred equity and $51\%$ common equity. The yield on the firm's bonds is $7\%.$ The firm has a beta of $1\mathrm{.}42.$ The risk free rate is $2\%$ and the return on a broad market index is $8\%.$ If the cost of preferred equity is $9\mathrm{.}2\%$ and the firm's tax rate is $40\%,$ determine the WACC.

$7\mathrm{.}639\%$

$7\mathrm{.}894\%$

$6\mathrm{.}894\%$

$8\mathrm{.}423\%$

none of these