The total market value of the common stock of the Okefenokee Real Estate Company is $$6$ million, and the total value of its debt is $$4$ million. The treasurer estimates that the beta of the stock is currently $1\mathrm{.}5$ and that the expected risk premium on the market is $6\%.$ The Treasury bill rate is $4\%.$ Assume for simplicity that Okefenokee debt is risk$-$free and the company does not pay tax.

Calculate the opportunity cost of equity capital if Okefenokee finances $40\%$ of the new venture using new debt $($same cost as existing debt$)$ and the remaining $60\%$ using an increase in retained earnings. Calculate the discount rate for the new venture.