Billy Sharpe just started work for Maynard Industries. He recently discovered that Maynard's employees had been evaluating capital budgeting projects at a discount rate of 17%, which was calculated 5 years ago when rates were substantially higher and the firm's capital structure was more skewed toward equity. He has discovered the following: 1. The firm's beta is 0.8; the stock sells for $20.00 per share and there are 2,000,000 shares outstanding; 2. T-bills are yielding 4%, and the firm's debt is yielding 8%. 3. The firm's debt consists of 10,000 debentures, each with $1000 par value, with a current quote in the newspaper of 120. 4. The preferred shares consist of 200,000, 8% shares with a par value of $35. Currently these sell for $40 each. 5. The Market Risk Premium is 7.5%. 6. The tax rate is 40%. Required: Compute Maynard Industries' required rate of return