You would like to estimate the weighted average cost of capital for a new airline business. Based on its industry asset beta, you have already estimated an unlevered cost of capital for the firm of 10% . However, the new business will be 27% debt financed, and you anticipate its debt cost of capital will be 7% . If its corporate tax rate is 39%, what is your estimate of its WACC and equity cost of capital?

The equity cost of capital is (Round to two decimal places.) The weighted average cost of capital is \%. (Round to two decimal places.)