DEF sold stock by under pricing it by $2.00 from its current stock price. It also had a flotation cost of $1.00. It is expected to pay $1.50 as dividend next year with a dividend growth of 8%. Its current stock price is $32.40.

What is its cost of new equity?

Answer the rate in whole numbers. For example if answer is 12.832%, then enter 12.83 as the answer.