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What is the firm cost of common equity

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Reference no: EM132091956

Question - O'Henry Inc. has a beta of 1.15 and a tax rate of 30%. The risk free rate of interest is 5.00%; and the market rate of return expected on equity securities is 13.00%. What is the firm's cost of common equity based on the CAPM?

A. 11.30%

B 12.35%

C 14.20%

D 15.35%

E 17.06%

Reference no: EM132091956

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