8.Canyon Eaterys common stock, which is currently selling for $65 per share, has a beta coefficient equal to 0.90. Canyon has paid a dividend equal to $5 per share since it has been business, and expectations are that the same dividend will be paid forever. Canyons investment banker charges 7 percent when new common stock is issued. Calculate:

a.Canyons cost of retained earnings

b.Canyons cost of new common equity