A stock's beta is 1.24, the tax rate is 36%, and the risk-free interest rate is 3.8% per year. The company's common stock has a market value of exist79.26 per share and its next dividend is expected to be exist5.11 per share. The yield to maturity for the company's long-term debt is 8.4% per year. If the riskiness of the company's equity requires that it provide a risk premium of 4.2% per year over the yield on its long-term debt, what is the company's annual cost of equity financing? 1) 12.6% 2) 14.1% 3) 14.4% 4) 13.6% 5) 13.196