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Use the following information: - Debt: $83,000,000 book value outstanding. The debt is trading at 87% of book value. The yield to maturity is 8%. - Equity: 3,300,000 shares selling at $50 per share. Assume the expected rate of return on Federated's stock is 17%. - Taxes: Federated's marginal tax rate is Tc=0.21. Suppose Federated Junkyards decides to move to a more conservative debt policy. A year later, its debt ratio is down to 13.00%(D/V= 0.1300). The pre-tax cost of debt has dropped to 7.6%. The company's business risk, opportunity cost of capital, and tax rate have not changed. Use the three-step procedure to calculate Federated's WACC under these new assumptions. Note: Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places. The table below shows a book balance sheet for the Wishing Well Motel chain. The company's long-term debt is secured by its real estate assets, but it also uses short-term bank loans as a permanent source of financing. It pays 13% interest on the bank debt and 12% interest on the secured debt. Wishing Well has 10 million shares of stock outstanding, trading at $88 per share. The expected return on Wishing Well's common stock is 22%. (Table figures in \$ millions.) Calculate Wishing Well's WACC. Assume that the book and market values of Wishing Well's debt are the same. The marginal tax rate is 21%. Note: Do not round intermediate calculations. Enter your answer as a percent rounded to 1 decimal place