XYZ corporation has $10 billion worth of bonds outstanding with a 6% annual yield to maturity.

The companys 500 million shares of common stock sell for $56 per share and have a beta of 1.5. The risk free rate is 4%, and the market return is 12%.

The company has 100 million shares of preferred stock that pay a $3 annual dividend, and sell for $30 per share.

Assuming a 21% tax rate, what is the companys WACC?

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