Question 7 [9 Marks] Wentworth is 100% equity financed. Its current beta is 0.9. The expected market rate of return is 14% and risk-free rate is 8%. Required: 7.1. Calculate Wentworth's cost of equity. (3) 7.2. If Wentworth changes its capital structure to 30% debt, it estimates that its beta will increase to 1.1. The after-tax cost of debt will be 7%. Should Wentworth make the capital structure change? (6)