Sandhill Inc.s common shares currently sell for $36 each. The firms management believes that its shares should really sell for $45 each. The firm just paid an annual dividend of $2 per share and management expects those dividends to increase by 8 percent per year forever (and this is common knowledge to the market).

What is the current cost of common equity for the firm? (Round final answer to 2 decimal places, e.g. 15.25%.)

What does management believe is the correct cost of common equity for the firm? (Round final answer to 2 decimal places, e.g. 15.25%.)