The 65 Percent Preferred Stock of Home Town Brewers Is Selling

The 6.5 percent preferred stock of Home Town Brewers is selling for $42 a share.What is the firm's cost of preferred stock if the tax rate is 35 percent and the par value per share is $100?

A) 17.50 percent
B) 15.92 percent
C) 16.17 percent
D) 16.52 percent
E) 15.48 percent