ABC Inc. has a the capital structure shown below.

Liabilities $116,711,838

Stockholders ' Equity $ 98,692,502

ABC Inc. will raise additional capital for new projects this year, in the amount of $44,390,642

The firm believes, however, that a capital structure with 56.9% debt is ideal and will seek to implement that change when they raise capital.

Currently, the firm has a beta of 1.8. The risk-free rate is at 2.7%, and the market risk premium is currently 8%.

The company will issue bonds with a par value of $1,000. The bonds will sold with coupon payments of $40, each paid on a semi- annual basis. They will be sold at par and have a maturity of 9 .

ABC Inc. expects to pay 5% on their state taxes, and 17% on their federal taxes.

What should the firm estimate as its new weighted average cost of capital?

(Round to the nearest dollar)