Using the information in the table, what is the firms cost of preferred stock?

State your answer as a percentage to two decimal places (e.g., 5.30)

Question 14 Target% in Capital Structure Debt 40% Preferred Stock 10% Equity 50% Tax Rate 21% Outstanding Bond Preferred Stock Info Common Stock Info (Annual Coupons) Preferred Divided $4 Current Dividend $3.00 Time to Maturity (years) 15 Current $86 Market Price Current Price $50.00 Coupon Rate APR 5.00% Preferred Yield Expected Growth in Dividends 2.16% Face Value $1,000 Current Market $1,240 Price