Question: When the risk-free return is 3.5%, what is the cost of equity capital for a company whose stock has a historical beta factor of 0.92

When the risk-free return is 3.5%, what is the cost of equity capital for a company whose stock has a historical beta factor of 0.92 and the security market indicates that the premium above the risk-free rate is 5%?

Select one: a. 0.011 b. 0.066 c. 0.081 d. 0.061

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