Jack's Construction Co. has 80,000 bonds outstanding that are selling at par value. The bonds yield 8.5 percent. The company also has 5 million...

Jack's Construction Co. has 80,000 bonds outstanding that are selling at par value. The bonds yield 8.5 percent. The company also has 5 million shares of common stock outstanding. The stock has a beta of 1.2 and sells for $30 a share. The U.S. Treasury bill is yielding 3 percent and the market risk premium is 7 percent. Jack's tax rate is 35 percent. What is Jack's weighted average cost of capital?