Question: Assuming that the expected market return is 11% and the risk-free rate of return is 8%, the cost of equity of a company which is

Assuming that the expected market return is 11% and the risk-free rate of return is 8%, the cost of equity of a company which is 40% debt financed with a beta of 0.8 will be closest to:

Select one:

a. 6.24%

b. 12.16%

c. 10.4%

d. 4.16%

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