What is good estimate for the cost of equity capital

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Reference no: EM132017306

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 = 0.020

Five-year average annual return on S&P 500 = 0.088

Percent of equity in company's long-term capital structure = 0.71

Your company's current stock beta = 1.8

Please enter your result as a decimal, rounded to the nearest two decimal places.

Reference no: EM132017306

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