1. Fisher Company is currently an all equity firm. The firm has a cost of capital of 10.5 percent. Fisher is considering switching to a debt-equity ratio of 0.80 with a pretax cost of debt of 7.4 percent. What will the firm's cost of equity be if it makes the switch? Ignore taxes.

   	a	13.57%
   	b	13.39%
   	c	13.15%
   	d	12.98%
   	e	12.73%