Consider the case of Turnbull Company: Turnbull Company has a target capital structure of 58% debt, 6% preferred stock, and 36% common equity. It has a before-tax cost of debt of 8.20%, and its cost of preferred stock is 9.30 %. If Turnbull can raise all of its equity capital from retained earnings, its cost of common equity will be 12.40%, However, if it is necessary to raise new common equity, it will carry a cost of 14.20%. If its current tax rate is 40%, Turnbull's weighted average cost of capital (WACC) will be 0.64% higher if it has to raise additional common equity capital by issuing new common stock instead of raising the funds through retained earnings. Turnbull Company is considering a project that requires an initial investment of $270,000.00. The firm will raise the $270,000.00 in capital by issuing $100,000.00 of debt at a before-tax cost of 10.20%, $30,000.00 of preferred stock at a cost of 11.40%, and $140,000.00 of equity at a cost of 14.30%. The firm faces a tax rate of 40%. The WACC for this project is