Problem 9-6 Company cost of capital Nero Violins has the following capital structure: a. What is the firm's asset beta? (Hint: What is the beta of a portolio of all the firm's securities?) Note: Do not round intermediate calculations. Round your answer to 3 decimal places. b. Assume that the CAPM is correct. What discount rate should Nero set for investments that expand the scale of its operations without changing its asset beta? Assume a risk-free interest rate of 6% and a market risk premium of 7%. Ignore taxes. Note: Do not round intermediate calculations. Enter your answer as a percent rounded to 2 decimal places