A company plans on financing major new expansion programs by drawing on funds in the following proportions that roughly correspond to its current capital structure:

Long-term debt $30 million

Preferred shares $10 million

New common shares $40 million

Issuing and underwriting expenses can be ignored. Debt can be issued at a coupon rate of 12 percent, and the required return on preferred shares would be 9 percent. Common shares currently trade at $45 per share. Next year's dividend is expected to be $2.25 per share. Management feels that, over the long run, growth in dividends should be about 10 percent per year. The corporate tax rate is 40 percent.

what is the cost of common equity? what is the firm's WACC?