GPS Inc. wishes to estimate its cost of retained earnings. The firm's beta is $1\mathrm{.}3.$ The rate on $6-$month T$-$bills is $2\%,$ and the return on the S&P $500$ index is $15\%.$ What is the appropriate cost for retained earnings in determining the firm's cost of capital?

Select one:

a$.$

$17\mathrm{.}0\%$

b$.$

$19\mathrm{.}5\%$

c$.$

$18\mathrm{.}9\%$

d$.$

$22\mathrm{.}1\%$