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8 of 10 SmartCar ASA has an investment beta of 1.3, and the risk-free rate is 4%. The expected return on the market portfolio is

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8 of 10 SmartCar ASA has an investment beta of 1.3, and the risk-free rate is 4%. The expected return on the market portfolio is 11%, and the corporate tax-rate is 27%. There are no personal taxes. The cost of debt is 5%, and the debt-to-value is 40% based on market values. What is SmartCar's cost of equity if the company is financed by equity only? A 15.00% B 16.40%. 13.10%. D 11.00%

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