Aluminum maker Alcoa has a beta of about 1.08,whereas Hormel Foods has a beta of 1.31.

If the expected excess return of the market portfolio is 6%, which of these firms has a higher equity cost of capital, and how much higher is it? a. The firm that has the higher equity cost of capital is ________ (Hormel Foods or Alcoa) by ________%.

(Select from the drop-down menu and round to two decimal places.)