Rivoli Inc. hired you as a consultant to help estimate its cost of capital. You have been provided with the following data: D₀ = $0.80; P₀ = $72.50; and g = 8.00% (constant). Based on the DCF approach, what is the cost of equity from retained earnings? Do not round your intermediate calculations.

Group of answer choices

a) 9.19%

b) 7.17%

c) 11.21%

d) 10.02%

e) 6.89%