Question: WSB Inc has common stock with a current market value of $784 million. The shareholder's receive 11.29% per year for the company's business risk. WSB

WSB Inc has common stock with a current market value of $784 million. The shareholder's receive 11.29% per year for the company's business risk. WSB also has bonds outstanding worth $487 million trading in secondary markets that have a current YTM of 4.88%.

Assuming a world with no taxes and no bankruptcy, what is WSB's cost of equity?

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