A firm has determined its optimal capital structure which is composed of the following sources and target market value proportions. Target Market Source of Capital Proportions Long-term debt Preferred stock 10 Common stock equity 70 20 Debt: The firm can sell a 15-year, $1,000 par value, 10 percent bond for $1040. A flotation cost of 2 percent of the face value would be required. Additionally, the firm's marginal tax rate is 35 percent. Preferred Stock: The firm has determined it can issue preferred stock at $60 per share par value. The stock will pay a $5.5 annual dividend. The cost of issuing and selling the stock is $4 per share. Common Stock: A firm's common stock is currently selling for $22 per share. The dividend expected to be paid at the end of the coming year is $1.65. Its dividend payments have been growing at a constant rate of 5.6% for the last four years. It is expected that to sell, a new common stock issue must be under-priced $2 per share in floatation costs. Calculate the firm's weighted average cost of capital assuming the firm has exhausted all retained earnings. (use cost of issuing new common stock)