A corporation is considering issuing new common stock (a seasoned equity offering).

The common stock will sell for $26.73, will pay a dividend of $1.92 at the end of the year; the dividend is expected to grow each year at a rate of 3.9% indefinitely.

Issuing the stock requires the services of an investment bank who will charge the company a flotation cost of 10%.

What is the company's cost of external equity?

Enter your answer as a decimal with a leading zero and 4 decimal places of precision (i.e. 0.1234)