Answer:
a. 11.30%
Explanation:
Cost of equity = Risk free rate + beta ( market risk premium)
Cost of equity = 5% + 1.05 ( 6%)
Cost of equity = 11.30%
*In finance, the cost of equity is the return (often expressed as a rate of return) a firm theoretically pays to its equity investors, i.e., shareholders, to compensate for the risk they undertake by investing their capital. Firms need to acquire capital from others to operate and grow.
