$1$ point

Given the following information, calculate the firm's WACC using new common equity.

Target capital structure: $35\%$ debt, $10\%$ preferred, $55\%$ common equity

Required return on preferred stock: $10\%$

Before$-$tax cost of debt: $8\%$

Current common stock price: $$32$

Next year's dividend on common stock: $$1\mathrm{.}50$

Growth rate $($constant$)$: $5\%$

Flotation cost: $6\%$

Marginal tax rate: $25\%$

$7\mathrm{.}67\%$

$8\mathrm{.}43\%$

$8\mathrm{.}11\%$

$7\mathrm{.}05\%$