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The table below shows a book balance sheet for the Wishing Well Motel chain. The companys long-term debt is secured by its real estate assets,

The table below shows a book balance sheet for the Wishing Well Motel chain. The companys long-term debt is secured by its real estate assets, but it also uses short-term bank loans as a permanent source of financing. It pays 13% interest on the bank debt and 11% interest on the secured debt. Wishing Well has 10 million shares of stock outstanding, trading at $85 per share. The expected return on Wishing Wells common stock is 18%. (Table figures in $ millions.)

Cash and marketable securities $ 130 Bank loan $ 270
Accounts receivable 290 Accounts payable 170
Inventory 50 Current liabilities $ 440
Current assets $ 470
Real estate 2,400 Long-term debt 2,150
Other assets 120 Equity 400
Total $ 2,990 Total $ 2,990

Calculate Wishing Wells WACC. Assume that the book and market values of Wishing Wells debt are the same. The marginal tax rate is 21%. (Do not round intermediate calculations.Enter your answer as a percent rounded to 1 decimal place.)

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