Home Depot Inc. $($ticker: HD$)$ has a market debt$-$equity ratio of $4,3.$ Its current debt cost of capital is $4,5\%,$

and its current equity cost of capital is $9,5\%.$ If Home Depot issues equity and uses the proceeds to repay

its debt and reduce its debt$-$equity ratio by $0,5,$ it will lower its debt cost of capital to $3,5\%.$ With perfect

capital markets, what are Home Depot's new equity cost of capital?