York Corporation is currently an all-equity firm that has 80,000 shares of stock outstanding with a market price of $42 a share. The current cost of equity is 12% and the tax rate is 34%. York is considering adding $1 million of perpetual debt with an interest rate of 8% to its capital structure. What would the value of equity be after the capital structure change is complete?

A. $2.4 million

B. $2.7 million

C. $3.3 million

D. $3.7 million

E. $3.9 million