PDA Associates, Inc. has the following capital structure, consisting of one public debt issue and common shares. It has a book value of debt of $33 million, which is publicly traded and trades a 90% of its face value. The debt is rated A+ and the A+ rated yield in the market is 5%. Its book value debt/equity ratio is 1.0. There are 10 million shares of common stock outstanding trading at $10 per share. The risk free rate of interest (estimated as the 10 year Treasury rate) is 2% and the expected market risk premium is 7%. Beta = 1 Tax rate = 21%

Estimate the WACC of PDA Associates Inc.