The XXX Co. currently has debt with a market value of $300 million outstanding. The debt consists of Bank loan with 4.5% refinancing interest rate. The firm also has an issue of 2 million preferred shares outstanding with a market price of $11.00 per share. The preferred shares pay an annual dividend of $1.10. Imaginary also has 14 million shares of common stock outstanding with a price of $25.00 per share. The firm is expected to pay a $3 common dividend one year from today, and that dividend is expected to increase by 5 percent per year forever. If Imaginary is subject to a 40 percent marginal tax rate, then what is the firms weighted average cost of capital?