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Honeywell's CFO hired you as a consultant to help her estimate the cost of capital for the company and in particular, the cost of equity

Honeywell's CFO hired you as a consultant to help her estimate the cost of capital for the company and in particular, the cost of equity from retained earnings. You have been provided with the following data: rRF = 2.4%; RPM = 3.6%; and b = 1.45. Using the CAPM approach, what is the cost of equity from retained earnings,rs?

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7.62%

10.93%

9.71%

8.44%

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