Phillips Equipment has 75,000 bonds outstanding that are selling at par. Bonds with similarcharacteristics are yielding 7.5 percent. The company also has 750,000 shares of 6 percentpreferred stock and 2.5 million shares of common stock outstanding. The preferred stock sells for$64 a share. The common stock has a beta of 1.21 and sells for $44 a share. The U.S. Treasurybill is yielding 2.3 percent and the return on the market is 11.2 percent. The corporate tax rate is34 percent. What is the firm's weighted average cost of capital?