Turnbull Company has a target capital structure of 45% debt, 4% preferred stock, and 51% common equity. It has a before-tax cost of debt of 11.10%, and its cost of preferred stock is 12.20%. If Turnbull can raise all of its equity capital from retained earnings, its cost of common equity will be 14.70%. However, if it is necessary to raise new common equity, it will carry a cost of 16.80%.

If its current tax rate is 40%, Turnbulls weighted average cost of capital (WACC) will be ______ higher if it has to raise additional common equity capital by issuing new common stock instead of raising the funds through retained earnings.

Turnbull Company is considering a project that requires an initial investment of $570,000.00. The firm will raise the $570,000.00 in capital by issuing $230,000.00 of debt at a before-tax cost of 11.10%, $20,000.00 of preferred stock at a cost of 12.20%, and $320,000.00 of equity at a cost of 14.70%. The firm faces a tax rate of 40%. The WACC for this project is _____.