Golden Gate Construction Associates, a real estate developer and building contractor in San Francisco, has two sources of long$-$term capital: debt and equity. The cost to Golden Gate of issuing debt is the after$-$tax cost of the interest payments on the debt, taking into account the fact that the interest payments are tax deductible. The cost of Golden Gate's equity capital is the investment opportunity rate of Golden Gate's investors, that is$,$ the rate they could earn on investments of similar risk to that of investing in Golden Gate Construction Associates. The interest rate on Golden Gate's $$98$ million of long$-$term debt is $10$ percent, and the company's combined federal and state income tax rates amount to $30$ percent. The cost of Golden Gate's equity capital is $14$ percent. Moreover, the market value $($and book value$)$ of Golden Gate's equity is $$126$ million.

Required:

Calculate Golden Gate Construction Associates' weighted$-$average cost of capital.

Note: Round your answer to $1$ decimal place. $($i$.$e$.,123$ should be entered as $12\mathrm{.}3)$

References

Weighted$-$average cost of capital

$\%$