Question: Using the capital asset pricing model, and the information provided below, what is a good estimate for the cost of equity capital? YTM on five-year

Using the capital asset pricing model, and the information provided below, what is a good estimate for the cost of equity capital?

YTM on five-year US Treasury note = 0.030

Five-year average annual return on S&P 500 = 0.091

Percent of equity in company's long-term capital structure = 0.31

Your company's current stock beta = 0.89

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