The Red Hen Currently Has a Debt-To-Equity Ratio of

The Red Hen currently has a debt-to-equity ratio of .45,its cost of equity is 13.6 percent,and its beta is 1.49.The pretax cost of debt is 7.8 percent,the tax rate is 35 percent,and the risk-free rate is 3.1 percent.The firm's target debt-to-equity ratio is .5.What discount rate should be assigned to a new project the firm is considering if the project is equally as risky as the overall firm and will be financed solely with debt?

A) 7.80%
B) 9.76%
C) 5.07%
D) 9.34%
E) 10.76%