size premium is 1.2% for this cap stock. rf- 2.56% Mrp- 5 20%

One approach for cost of equity that we took in class used the CAPM plus a size premium. Recall that market information is included in the supplementary information for this exam, and use the CAPM plus a size premium to estimate the cost of equity for a firm that has a beta of 1.1, a current stock price of $175, and 36 million shares outstanding. Answer IN DECIMAL FORM (i.e., NOT 2.15%, but rather 0215) and TO FOUR DECIMAL PLACES. Your