Sadaplast has a target capital structure of 65% common equity, 30% debt, and 5% preferred

stock. The cost of retained earnings is 14%, and the cost of new equity is 15.5%. Sadaplast

expects to have a net income of $85 million in the coming year. If the firm sells bonds,

up to $25 million can be sold at par value to yield an after-tax cost of 5.4%. An additional $20 million of debentures could be sold to yield an after-tax cost of 7.0%. The after-tax cost of preferred stock financing is estimated to be 11%.

Sadaplast has a dividend payout ratio of 25%. What is Sadaplast's weighted Average cost of capital between the first and second break points?