Consider the following information for Watson Power Co.: Debt: 4,000 8.5 percent coupon bonds outstanding, $1,000 par value, 18 years to maturity, selling for 103 percent of par; the bonds make semiannual payments. Common stock: 92,000 shares outstanding, selling for $62 per share; the beta is 1.07. Preferred stock: 12,500 shares of 8 percent preferred stock outstanding, currently selling for $105 per share. Market: 9.5 percent market risk premium and 8 percent risk-free rate. Assume the company's tax rate is 35 percent. Find the WACC.