Amarindo, Inc. (AMR), is a newly public firm with 10.0 million shares outstanding. You are doing a valuation analysis of AMR. You estimate its free cash flow in the coming year to be $14.85 million, and you expect the firm's free cash flows to grow by 4.3% per year in subsequent years. Because the firm has only been listed on the stock exchange for a short time, you do not have an accurate assessment of AMR's equity beta. However, you do have beta data for UAL, another firm in the sameindustry:

	Equity Beta	Debt Beta	Debt-Equity Ratio
UAL	1.65	0.33	1.1

AMR has a much lower debt-equity ratio of 0.33, which is expected to remain stable, and its debt is risk free. AMR's corporate tax rate is 30%,

the risk-free rate is 5.2%,

and the expected return on the market portfolio is 10.8%.

a. Estimate AMR's equity cost of capital.

b. Estimate AMR's share price.