Question: Vision Corporation has debt with both a face and a market value of $4,200,000. This debt has a coupon rate of 5 percent and pays

Vision Corporation has debt with both a face and a market value of $4,200,000. This debt has a coupon rate of 5 percent and pays interest annually. The expected earnings before interest and taxes are $2,200,000, the tax rate is 25 percent, and the unlevered cost of capital is 11.4 percent. What is the firm's cost of equity?

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