Sorensen Systems Inc. is expected to pay a dividend of $2.70 at year end (D1), the dividend is expected to grow at a constant rate of 5.50% a year, and the common stock currently sells for $37.50 a share. The before-tax cost of debt is 7.50%, and the tax rate is 40%. The target capital structure consists of 45% debt and 55% common equity. What is the companys WACC if all the equity used is from retained earnings?

Your answer should be between 7.36 and 12.57, rounded to 2 decimal places, with no special characters.