Assume that Kish Inc. hired you as a consultant to help estimate its cost of capital. You have obtained the following data: D₀ = $0.90; P₀ = $37.50; and g = 7.00% (constant). Based on the DCF approach, what is the cost of equity from retained earnings? Do not round your intermediate calculations.

Select one:

a. 9.57%

b. 8.13%

c. 7.75%

d. 10.05%

e. 9.28%