Stock Stream has decided to keep all its net income and reinvest it into the c

Stock Stream has decided to keep all its net income and reinvest it into the company i.e. retained earnings. Its investment banker has
informed it that its stock is selling for $65 and it could offer new shares at this price but would have to pay a floatation cost of 7%. Stock stream has just
paid a dividend of $1 and has made it clear it will growth this dividend by 5% a year forever. Stock Stream has a tax rate of 30%What is the cost of this
retained earnings?
A. 1.54% B. 4.63% C. 6.54% D. 6.62% E. 9.45% If possible can you show how to come to the answer.