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 9 % . However, the new business will be 27 % debt financed, and you anticipate its debt cost of capital will be 5 % . If its corporate tax rate is 32 % , what is your estimate of its WACC?

A. The equity cost of capital is %? (Round to one decimal place.)

B. WACC? (Round to two decimal places)