ABC Hardware, Inc. is considering an investment in the plumbing supply business. The analysts at ABC Company headquarters have gathered the following information to help them compute a discount rate to evaluate the investment. The investment will be financed with 60% debt and 40% equity. ABCs cost of debt is 7.5% and their tax rate is 30%. Additionally, the analysts will use a risk-free rate of 4% and a market risk premium of 8%. Finally, the analysts have been Page 5 of 10 able to identify the following two publicly traded companies which they can use to compute a measure of business risk for the plumbing supply business.