Question: Please provide formula and step by step instructions how to get CAPM. Problem 9-6 Cost of Equity: CAPM Booher Book Stores has a beta of

Please provide formula and step by step instructions how to get CAPM.

Problem 9-6 Cost of Equity: CAPM Booher Book Stores has a beta of 1.3. The yield on a 3-month T-bill is 4.5% and the yield on a 10-year T-bond is 6%. The market risk premium is 6.5%, and the return on an average stock in the market last year was 12.5%. What is the estimated cost of common equity using the CAPM? Round your answer to two decimal places. %

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