Stock in Country Road Industries has a beta of 1.2. The market risk premium is 9 percent, and T-bills are currently yielding 3 percent. The company's most recent dividend was $1.9 per share, and dividends are expected to grow at a 6.5 percent annual rate indefinitely. If the stock sells for $35 per share, what is your best estimate of the company's cost of equity? (Do not round your intermediate calculations.)

11.44%

10.2%

13.8%

12.28%

13.04%