Question $8$

$5$ pts

Sorensen Systems Inc. is expected to pay a dividend of $$3\mathrm{.}60$ at year end $(D_1),$ the dividend is expected to grow at a constant rate of $5\mathrm{.}50\%$ a year, and the common stock currently sells for $$37\mathrm{.}50$ a share. The before$-$tax cost of debt is $7\mathrm{.}50\%,$ and the tax rate is $40\%.$ The target capital structure consists of $45\%$ debt and $55\%$ common equity. What is the company's WACC if all the equity used is from retained earnings?

Your answer should be between $7\mathrm{.}36$ and $12\mathrm{.}57,$ rounded to $2$ decimal places, with no special characters.