XBOX Inc. has 100,000 bonds outstanding that are selling at 95 per cent of par. Bonds with similar characteristics are yielding 2.5 per cent. The company just issued zero coupon bonds with a par value of 500 million at 20 cents on the euro with a maturity in 50 years. The company also has 750,000 shares of 7 per cent preference shares and 2.5 million shares of ordinary equity outstanding. The preference shares sell for 68 a share. The ordinary equity has a beta of 1.34 and sells for 42 a share. The government Treasury bill is yielding 1.8 per cent and the return on the market is 12.2 per cent. The corporate tax rate is 28 per cent. What is the firm's weighted average cost of capital?