Use the following information:

Debt: $$79,000,000$ book value outstanding. The debt is trading at $94\%$ of book value. The yield to maturity is $7\%.$

Equity: $2,900,000$ shares selling at $$46$ per share. Assume the expected rate of return on Federated$$s stock is $16\%.$

Taxes: Federated$$s marginal tax rate is$$Tc$=0\mathrm{.}21=0\mathrm{.}21.$

Suppose Federated Junkyards decides to move to a more conservative debt policy. A year later, its debt ratio is down to $14\mathrm{.}00\%($D$/$V$=0\mathrm{.}1400).$ The pre$-$tax cost of debt has dropped to $6\mathrm{.}6\%.$ The company$$s business risk, opportunity cost of capital, and tax rate have not changed.

Use the three$-$step procedure to calculate Federated$$s WACC under these new assumptions.

Note: Do not round intermediate calculations. Enter your answer as a percent rounded to $2$ decimal places.