Pacific Intermountain Utilities Company has a present capital structure (which the company feels is optimal) of 30 percent long-term debt, 8 percent preferred stock, and 62 percent common equity.For the coming year, the company has determined that its optimal capital budget can be externally financed with $55 million of 15 percent first-mortgage bonds sold at par and $20 million of preferred stock costing the company 18 percent. The remainder of the capital budget will be financed with retained earnings. The company's common stock is presently selling at $15 a share, and next year's common dividend, D1, is expected to be $2 a share. The company has 22 million common shares outstanding. Next year's net income available to common stock (including net income from next year's capital budget) is expected to be $90 million. The company's past annual growth rate in dividends and earnings has been 7 percent. However, a 5 percent annual growth in earnings and dividends is expected for the foreseeable future. The company's marginal tax rate is 40 percent. Round your answer to two decimal places, 10.12% would be shown as 10.12. What is the cost of equity? What is the WACC