The real assets of Basic Co. generate cash flows of $92 million per year. The value of debt is $260 million, the return on debt is 5%, and the coupon rate equals the yield on all debt issues. Interest is paid annually. The tax rate is 35%.

Suppose that the value of the firm is $820 million, the return on equity is 18%, and annual interest payments grow at 1% per year. Calculate the Opportunity Cost of Capital of real assets.