Easy Car Corp. is a grocery store located in the Southwest. It paid an annual dividend of $10.00 last year to its shareholders and plans to increase the dividend annually at the rate of 4.0%. It currently has 6,000,000 common shares outstanding. The shares currently sell for $40 each. Easy Car's common stock has a beta of 1.1

The expected market return is 13% and the risk free rate is 3%. The corporate tax rate is 30%.

What is the best estimate of the cost of equity to use in the computation of the WACC for Easy Car Corp.?