Mikkelson Corporation's stock had a required return of 13.00% last year, when the risk-free rate was 3% and the market risk premium was 4.75%. Then an increase in investor risk aversion caused the market risk premium to rise by 2%. The risk-free rate and the firm's beta remain unchanged. What is the company's new required rate of return? (Hint: First calculate the beta, then find the required return.) Do not round your intermediate calculations.

a.

17.90%

b.

16.18%

c.

17.21%

d.

19.62%

e.

16.52%