Bunkhouse Electronics is a recently incorporated firm that makes electronic entertainment systems. Its earnings and dividends have been growing at a rate of 30.5%, and the current dividend yield is 2.50%. Its beta is 1.21, the market risk premium is 8.50%, and the risk-free rate is 3.90%.

Use the CAPM to estimate the firms cost of equity.

Note: Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places.

Now use the constant growth model to estimate the cost of equity.

Note: Do not round intermediate calculations. Enter your answer as a whole percent.

Which of the two estimates is more reasonable?