Question: Can you explain this one? 10 points Save A The market value of AAA's common stock is 40 million and the market value of the

Can you explain this one?

10 points Save A The market value of AAA's common stock is 40 million and the market value of the risk-free debt is 60 million. The beta of the company's common stock is 1.01, and t expected market risk premium is 0.064. If the Treasury bill rate is 6%, what is the firm's cost of capital? give the answer in decimal form precise to three digits after the comma. (Assume no taxes)

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