Considering the following information, calculate the cost of equity.

risk$-$free interest rate $=5\%$

nominal rate of interest $=7\%$

inflation premium $=3\%$

equity investment risk premium $=2\%$

Pick One

a$.17\mathrm{.}00\%$

b$.13\mathrm{.}00\%.$

c$.14\mathrm{.}00\%.$

d$.16\mathrm{.}00\%.$

e$.12\mathrm{.}00\%.$

$15\mathrm{.}00\%.$