Company A has 65,000 bonds outstanding that are selling at par. Bonds with similar characteristics are yielding 7.5 percent. The company also has 750,000 shares of $5 dividend preferred stock and 2 million shares of common stock outstanding. The preferred stock sells for $60 a share. The common stock has a beta of 1.08 and sells for $45 a share. The U.S. Treasury bill is yielding 2.5 percent and the return on the market is 10 percent. The corporate tax rate is 20 percent. What is the firm's weighted average cost of capital?