Common stock: The company's 500,000 shares of common stock sell for $25 per share and have a beta of 1.5. The risk-free rate is 4%, and the market risk premium is 8%. Preferred stock: The company's 100,000 shares of preferred stock pay a $3 annual dividend, and sell for $30 per share. Debt: A corporation has 10,000 bonds outstanding with 6% coupon rate, semi-annual coupon payments, 8 years to maturity, $1,000 face value, and $1,100 market price. Assuming a 21% tax rate, what is the company's weighted average cost of capital ? Step 1: Component costs of capital: Rg, Rp, RD Step 2: Capital structure weights: E/V, P/V, D/V Step 3: WACC