Marino Company, which operates a boarding house in Japan, has a target capital structure of 25% debt, 65% common equity, and 10% preferred stock. The Company's before-tax cost of debt is 10%, and the marginal tax rate is 36%. The current stock price is $62, and it has just paid dividends of $4.5. The dividends are expected to grow at a 7% constant rate. Its preferred stock is trading at $116, in which it has a $100 par value and 13% dividend rate. Required: Calculate the weighted average cost of capital for Mario Company. Cost of debt = (15 marks)