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Green Caterpillar Garden Supplies Inc. is closely held and, as a result, cannot generate reliable inputs for the CAPM approach. Green Caterpillar's bonds yleld 11.50%,

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Green Caterpillar Garden Supplies Inc. is closely held and, as a result, cannot generate reliable inputs for the CAPM approach. Green Caterpillar's bonds yleld 11.50%, and the firm's analysts estimate that the firm's risk premium on its stock relative to its bonds is 3.00%. Using the bond-yleldplus-risk-premium approach, the firm's cost of equity is

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