Scanlon Inc.'s CFO hired you as a consultant to help her estimate the cost of capital. You have been provided with the following data: r RF = 4.10%; RPM=5.25%; and b = 1.70. Based on the CAPM approach, what is the cost of equity from retained earnings?
a. 13.03%
b. 12.63%
c. 13.94%
d. 10.03%
e. 15.24%
