Problem 19-4 WACC Use the following Information: Debt: $80,000,000 book value outstanding. The debt is trading at 95% of book value. The yield to maturity is 9%. Equity: 3,000,000 shares selling at $47 per share. Assume the expected rate of return on Federated's stock is 18%. Taxes: Federated's marginal tax rate is TC = 0.21. Suppose Federated Junkyards decides to move to a more conservative debt policy. A year later, its debt ratio is down to 13.75% (D/= 0.1375). The Interest rate has dropped to 8.6%. The company's business risk, opportunity cost of capital, and tax rate have not changed. Use the three-step procedure to calculate Federated's WACC under these new assumptions. (Do not round Intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.) Weighted average cost of capital %