QUESTION $14$

Lowell Corporation is currently a levered firm with a debt$-$equity ratio of $0\mathrm{.}30$ and a pretax cost of debt of $6\%.$ Tire firm has a cost of equity of $11\mathrm{.}70\%.$ The firm is considering switching to an all equity firm. What will the firm's cost of equity be if it makes the switch? Ignore taxes.

$10\mathrm{.}31\%$

$10\mathrm{.}38\%$

$10\mathrm{.}45\%$

$10\mathrm{.}52\%$

$10\mathrm{.}59\%$