Bedazzled Inc. typically uses equity as their main source of funding and only raises funds using debt for about 10% of their total funding. Their before-tax cost of debt was recently estimated to be 5% while the before-tax cost of their equity was recently estimated at 12%. Estimate the firms WACC. Assume the firm faces a tax rate of 40%. (Hint: Be careful if you costs are before-tax or after-tax.)