Dyson Inc. currently finances with 20.0% debt (i.e., w d = 20%), but its new CFO is considering changing the capital structure so w d = 74.5% by issuing additional bonds and using the proceeds to repurchase and retire common shares so the percentage of common equity in the capital structure (w c) = 1 w d. Given the data shown below, by how much would this recapitalization change the firm's cost of equity? Do not round your intermediate calculations. (Hint: You must unlever the current beta and then use the unlevered beta to solve the problem.)

Risk-free rate, rRF	5.00%		Tax rate, T	40%
Market risk prem, RPM	6.00%		Current wd	20%
Current beta, bL1	1.50		Target wd	74.5%

	a.	13.30%
	b.	13.55%
	c.	15.68%
	d.	12.29%
	e.	12.54%