Question $6(1$ point$)$

Risk free rate is $4\%.$ Market return is $12\%.$ A firm is with cost of debt is $5\%,$ weight of equity is $20\%,$ weight of debt is $80\%,$ and beta is $2.$ Under APV model, what is unlevered cost of equity?

$9\%$

$10\%$

$8\%$

$7\%$