Economies of Scope A survey of a local market has provided the following average cost data: Johnson Construction Corp. (JCC) has assets of $5.5 million and an average cost of 11.5 percent. Anderson Architects (AA) has assets of $6.5 million and an average cost of 21.5 percent. Cole Home Builders (CHB) has assets of $6.5 million and an average cost of 16.5 percent. For each firm, average costs are measured as a proportion of assets. JCC is planning to acquire AA and CHB with the expectation of reducing overall average costs by eliminating the duplication of services. If JCC plans to reduce operating costs by $350,000 after the merger, what will the average cost be for the new firm? (Round your answer to 3 decimal places.)