North Pole Fishing Equipment Corp. and South Pole Fishing Equipment Corp. would have identical equity betas of 1.25 if both were all- equity financed. The market value Information for each company is shown here: North Pole South Pole Debt $4,600,000 $5,500,000 Equity $5,500,000 $4,600,000 The expected return on the market portfolio Is 14.10 percent, and the risk-free rate is 5.4 percent. Both companies are subject to a corporate tax rate of 35 percent. Assume the beta of debt is zero. a. What is the equity beta of each of the two companies? (Do not round Intermediate calculations. Round the answers to 2 decimal places.) North Pole South Pole Equity beta 1.68 1.97 b. What is the required rate of return on each of the two companies' equity? (Do not round Intermediate calculations. Round the answers to 2 decimal places.) North Pole South Pole Rate of return 20.01% 22.551 %