"ABC is a private firm with a leverage ratio of $0\mathrm{.}25.$ The interest rate on ABC's debt is $5\%.$ Given the following information, find ABC's WACC. There are $2$ publicly traded firms in this industry. The first, CDB$,$ has an equity beta of $1\mathrm{.}5,$ borrowing rate of $4\%,$ and a leverage ratio of $0\mathrm{.}20.$ The second firm, DEG, has no debt and its beta is $0\mathrm{.}8.$ The tax rate is $30\%,$ the risk$-$free rate is $2\%,$ and the market risk premium is $6\%."$

The correct asnwer is $7\mathrm{.}75\%.$ Surpringly all solutions posted on Chegg so far this for this type of question are wrong. Please provide a solution that correctly solves for this question, even when the numbers change $($so that steps can still be correctly applied to get the right solution$).$