Newark Co. is based in the U.S. Approximately 30% of its sales are from exports to Portugal, and the company has no other international business. It finances its operations with 40% equity and the remainder of funds with dollar-denominated debt. Newark borrows its funds from a U.S. bank at an interest rate of 9 percent per year. The long-term risk-free rate in the U.S. is 6 percent, whereas the long-term risk-free rate in Portugal is 11 percent. The stock market return in the U.S. is expected to be 13 percent annually. Newark’s stock price typically moves in the same direction and by the same degree as the U.S. stock market. Its earnings are subject to a 20% corporate tax rate. Estimate the cost of capital to Newark Co.