Phillips Equipment has 80,000 bonds outstanding that are selling for $940; par = $1,000. They mature in 8 years and pay annual coupon interest of 6%. The company also has 450,000 shares of 7 percent preferred stock, with a $100 par value, and 2.5 million shares of common stock outstanding. The preferred stock sells for $53 a share. The common stock has a beta of 1.24 and sells for $42 a share. The risk-free rate of return is 2.8 percent and the market rate of return is 11.6 percent. The corporate tax rate is 38 percent. What is Phillips' WACC