4. Zosnick Poultry Corporation has launched an expansion program that, in 6 years, should result in the saturation of the Bay Area marketing region of Cali-

, -) fornia. As a result, the company is predicting a growth in earnings of 12 percent for 3 years, 6 percent for years 4 through 6, then constant earnings for the foreseeable future. The company expects to increase its dividend per share, now $2, in keeping with this growth pattern. Currently, the market price of the stock is $25 per share. Estimate the company's cost of equity capital.