Problem $2$ The market value of the equity in Bayside PLC$,$ an engineering firm, is $60$m and the market value of its debt is $30$m$.$ The beta of the equity is $1\mathrm{.}2$ and the expected market risk premium on the market is $8$ percent. The risk$-$free rate of interest has been estimated at $4\mathrm{.}5\%$ and Bayside can borrow at this rate. The corporate tax rate is $30\%($a$)$ What is the required return on Bayside's equity? $($b$)$ Estimate the firms cost of capital?