Blair Brothers' stock currently has a price of $55 per share and is expected to pay a year-end dividend of $1.4 per share (D1 - $1.4). The dividend is expected to grow at a constant rate of 2 percent per year. The company has insufficient retained earnings to fund capital projects and must, therefore, issue new common stock. The new stock has an estimated flotation cost of $5 per share. What is the company's cost of equity capital? 4.80% 4.20% O 4.40% 4.60% O 5.00%